Tokenization & Distribution
Tokenization is fundamentally transforming the operational infrastructure of the asset management industry. By embedding asset rights into programmable digital units, tokenization disrupts traditional workflows, redistributes roles, and enables a more fluid and accessible financial ecosystem.
Technology redefines each segment of the asset management value chain—from fund creation to investor servicing. Capital raising becomes more inclusive as tokenization supports fractional ownership and global investor access. Portfolio management gains efficiency through token-enabled real-time data and rebalancing logic. Reporting becomes automated and standardized, feeding dashboards directly from the blockchain. Even exit strategies are improved, as secondary markets for tokenized assets allow earlier liquidity without major market disruption. Here a short overview of the shifts we foresee:
Tokenization changes the operational models. With assets existing natively on-chain, many of these functions become automated via smart contracts. Settlements can occur in real-time (T+0), reducing counterparty risk and capital lock-up. Compliance obligations can be embedded directly into tokens through programmable logic, turning what was once a retroactive control function into a proactive, real-time safeguard.
The custodia's role is evolving rapidly. Instead of safeguarding physical certificates or database entries, custodians now focus on the secure storage and management of private keys. This shift introduces new responsibilities—cybersecurity, wallet infrastructure, and key recovery protocols all become integral to custodial operations.
Tokenized systems introduce radical transparency. Compliance becomes integrated nto code via smart contracts—ensuring that only verified wallets can hold or trade certain tokens, or that regional rules (such as AML/KYC) are enforced at the token level. This programmability marks a shift from reactive to continuous compliance, improving both efficiency and regulatory trust.
Tokenization collapses this into a single, near-instantaneous event. Smart contracts execute Delivery-vs-Payment (DvP) automatically, ensuring both asset and payment change hands without delay or default risk. By eliminating intermediaries like central securities depositories (CSDs) or clearing houses, operational costs decline while security and speed improve.
Tokenization is not a distant future scenario—it is a current and accelerating trend reshaping operational foundations and redistributing value. Its influence reaches far beyond technology, touching governance, risk, access, and trust. For firms across the value chain, the message is clear: adapt or risk irrelevance. Custodians must upgrade their digital capabilities. Compliance teams need to collaborate with software engineers. Asset managers must work closely with token infrastructure providers to ensure interoperability and regulatory readiness. And regulators themselves must evolve from reactive oversight bodies into proactive enablers of innovation.
What is Tokenization?
Tokenization of shares leverages Distributed Ledger Technology (DLT), which allows asset ownership to be recorded and transferred across a decentralized network without relying on traditional intermediaries. Secured by blockchain protocols, this infrastructure ensures data integrity through cryptographic validation. With the advent of smart contracts—programmable agreements embedded into second-generation blockchains—transactions can now follow predefined, automated rules. Together, DLT and smart contracts provide the foundational framework for issuing and managing tokenized shares in a secure, efficient, and transparent manner.
