UK investment managers seek approval for blockchain-traded funds
The Investment Association believes the new technology will bring significant cost savings to end investors.
New
The Investment Association, a trade body representing UK investment managers, is accelerating local government and financial regulators to approve funds traded on the blockchain with digital tokens replacing traditional shares.
As the Financial Times reported on Thursday, the trade body is pushing the government to establish a new class of funds using blockchain technology and create a new task force to examine how distributed ledger technology could accelerate the creation of new products and services.
The reasons for such a push, according to the Investment Association, are the significant cost savings possible for end investors and the simplification of existing procedures for buying and selling mutual funds.
Investment Association Chief Executive Chris Cummings urged to strengthen the competitiveness of domestic financial services:
"Greater innovation will boost the overall competitiveness of the UK fund industry and improve the cost, efficiency and quality of the investment experience."
According to FT, funds traded on the blockchain could be available by the end of the second quarter of 2023 if the Financial Conduct Authority (FCA) gives its regulatory approval. As the newspaper adds, a fintech group FundAdminChain is currently collaborating with the London Stock Exchange and four global asset managers to develop live tokenized funds for the UK market.
Related: Majority of UK crypto owners turned out to be hodlers
Brian McNulty, CEO of FundAdminChain, revealed that asset managers have realized the potential to generate above-market returns via tokenization of funds:
“Tokenized funds can offer more transparency, instant settlement, data improvements and analytics that will contribute to a more efficient system for investors, but we need regulatory support to ensure that the UK Uni remains competitive with other jurisdictions."
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The Investment Association believes the new technology will bring significant cost savings to end investors.
New
The Investment Association, a trade body representing UK investment managers, is accelerating local government and financial regulators to approve funds traded on the blockchain with digital tokens replacing traditional shares.
As the Financial Times reported on Thursday, the trade body is pushing the government to establish a new class of funds using blockchain technology and create a new task force to examine how distributed ledger technology could accelerate the creation of new products and services.
The reasons for such a push, according to the Investment Association, are the significant cost savings possible for end investors and the simplification of existing procedures for buying and selling mutual funds.
Investment Association Chief Executive Chris Cummings urged to strengthen the competitiveness of domestic financial services:
"Greater innovation will boost the overall competitiveness of the UK fund industry and improve the cost, efficiency and quality of the investment experience."
According to FT, funds traded on the blockchain could be available by the end of the second quarter of 2023 if the Financial Conduct Authority (FCA) gives its regulatory approval. As the newspaper adds, a fintech group FundAdminChain is currently collaborating with the London Stock Exchange and four global asset managers to develop live tokenized funds for the UK market.
Related: Majority of UK crypto owners turned out to be hodlers
Brian McNulty, CEO of FundAdminChain, revealed that asset managers have realized the potential to generate above-market returns via tokenization of funds:
“Tokenized funds can offer more transparency, instant settlement, data improvements and analytics that will contribute to a more efficient system for investors, but we need regulatory support to ensure that the UK Uni remains competitive with other jurisdictions."
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