Mortgage Token
Project Overview
The Mortgage Token Working Group, led by Thomas Ankenbrand from the Institute of Financial Services Zug (IFZ), explored the potential of Distributed Ledger Technology (DLT) for the tokenization of mortgage-related rights in Switzerland.
Given the significant role of mortgages in the Swiss financial system – with around CHF 1.25 trillion in outstanding mortgage loans held by Swiss banks – the project examined whether tokenization could create new opportunities for the funding, distribution and servicing of mortgage exposures.
Approach
The Working Group assessed the feasibility of mortgage tokenization across social, economic, legal & regulatory, tax and technological dimensions.
A key finding of the project is that, under current Swiss law, a mortgage itself cannot simply be tokenized and transferred on-chain. However, mortgage-related rights could potentially be represented through a token-based structure, for example using a Swiss-domiciled special purpose vehicle (SPV).
To put the concept into practice, the project also developed a working prototype connecting the traditional mortgage process with an on-chain investor layer. The proposed architecture combines conventional fiat settlement on the borrower side with stablecoin-based settlement and smart contracts on the investor side.
Results
The analysis demonstrates that the proposed mortgage-token lifecycle is technically feasible at prototype level. Potential benefits include programmable token and payment records, reduced reconciliation, more efficient servicing processes, and additional funding and distribution channels.
At the same time, the study identifies important requirements and challenges that would need to be addressed before moving towards a production-ready solution, including legal and regulatory implementation, taxation, governance, custody, interoperability, cybersecurity and secondary-market liquidity.
Publication
The results of the SFTI Mortgage Token Working Group have been published as Chapter 5: “Mortgage Tokenization” (pp. 56–72) of the IFZ Crypto Assets Study 2026.
The chapter presents the findings of the Working Group, the proposed architecture and the mortgage-token prototype.
A special thank you to the team of Thomas Ankenbrand (IFZ) for leading the Working Group and to all Working Group members and contributors for their valuable expertise and collaboration throughout the project.