IOTA's TWIN and Salus platforms will incorporate the G20-established Global Legal Entity Identifier Foundation (GLEIF) standard for decentralized digital identity, aiming to address the $2.5 trillion global trade finance deficit through tokenization.

Executive Summary

IOTA's TWIN and Salus platforms will incorporate the G20-established Global Legal Entity Identifier Foundation (GLEIF) standard for decentralized digital identity, aiming to address the $2.5 trillion global trade finance deficit through tokenization.

The Event in Detail

The IOTA Foundation has partnered with the Global Legal Entity Identifier Foundation (GLEIF) to integrate verifiable digital identities into blockchain networks. This collaboration will see IOTA's Identity Framework and its Trade Worldwide Information Network (TWIN) infrastructure, alongside the Salus platform, adopt the GLEIF standard for Decentralized Digital Identity (DID). The GLEIF standard, which issues a globally recognized 20-digit alpha-numeric code known as the Legal Entity Identifier (LEI), was established by the G20's Financial Stability Board after the 2008 financial crisis to provide a universal means of identifying legal entities in financial transactions. The initiative aims to create immediate trust among businesses by simplifying Know Your Business (KYB) validations through cryptographic proofs. This development targets the $2.5 trillion global trade finance gap, particularly within the critical minerals sector, by leveraging tokenization.

Financial Mechanics and Business Strategy

The integration focuses on the verifiable Legal Entity Identifier (vLEI), a cryptographically secure digital counterpart to the conventional LEI, which enables automatic verification of an organization's identity on-chain. As of Q1 2025, over 2.71 million active LEIs are registered globally. TWIN and Salus utilize IOTA Identity to manage digital identities for participants and assets within supply chains. This system facilitates secure data exchange, smart contract execution, and tokenization. For instance, Salus transforms key trade documents, such as warehouse receipts, into Non-Fungible Tokens (NFTs) stored on the IOTA ledger. This digitalization and tokenization enable real-time tracking and verification of shipments, creating auditable digital assets that funders can trust. The strategy directly addresses inefficiencies in traditional trade finance, characterized by extensive paperwork, fragmented databases, and manual verification processes, which have hindered access to capital, especially for businesses in high-risk countries. By providing structured information and verifiable credentials, the system aims to reduce compliance costs and accelerate market entry. Salus aims to open access to capital from Decentralized Finance (DeFi) funds and stablecoin pools, fostering transparency, speed, and liquidity in the critical minerals market, which includes copper, lithium, and rare earth elements.

Market Implications

This adoption of the GLEIF standard by TWIN and Salus represents a step toward legitimizing Decentralized Digital Identities (DIDs) within global financial frameworks. The integration is expected to enhance trust, interoperability, and regulatory compliance for blockchain-based identity and trade finance solutions, potentially attracting substantial institutional capital. The initiative addresses the emerging challenge of integrating legal identity systems into blockchain-based finance, including DeFi, tokenized assets, and cross-chain transactions, all of which require verifiable organizational identity. The G20 has prioritized a coordinated policy and regulatory response to crypto-assets, and bodies like the Financial Stability Board (FSB) and the International Organization of Securities Commissions (IOSCO) have established frameworks and recommendations for crypto and digital asset markets. By aligning with a globally recognized standard like GLEIF's vLEI, the collaboration aims to bridge the gap between blockchain-based identity systems and existing infrastructure, reducing the need for repeated data verification and minimizing compliance complexities while maintaining regulatory integrity. This move is observed by market participants as bullish for institutional adoption and regulatory acceptance of DIDs and blockchain technologies in trade finance.