Fund management firm La Française integrates Allfunds Blockchain for distribution purposes.
In the rapidly evolving world of finance, asset managers are increasingly turning to blockchain technology to revolutionize fund distribution and management. This shift towards digital asset management is evident in partnerships between prominent asset managers and blockchain platforms.
One such partnership involves Schroders, collaborating with Calastone to explore the use of public blockchain for fund distribution. Similarly, BNP Paribas Securities Services is the service provider for Azimut's integration of Allfunds Blockchain with its legacy systems. These collaborations underscore the industry's growing interest in blockchain technology and asset tokenization.
Asset Tokenization and Blockchain Integration
Asset managers are partnering with blockchain platforms to tokenize various investment products, including funds, real estate, commodities, and real-world assets (RWAs). Tokenization enhances liquidity, accessibility, and transparency by enabling fractional ownership and quicker settlement times on decentralized ledgers.
Efficiency and Transparency Gains
Blockchain technology provides a shared, decentralized ledger that enhances transaction security and offers a permanent, transparent record. This reduces operational inefficiencies, lowers costs, and improves auditability for asset managers and their clients.
Institutional Adoption and Scale
Leading asset managers are focusing on institutional-level solutions that bridge traditional finance with digital asset management, reflecting growing readiness among clients for blockchain-enabled products. For instance, firms like Janus Henderson are pursuing tokenized real-world asset funds along with strategic blockchain partnerships.
Ecosystem Partnerships
Collaborations between asset managers and blockchain infrastructure providers are accelerating innovation and the deployment of operationally ready solutions. Allfunds Blockchain, Calastone, and FundsDLT are examples of platforms that specialize in fund distribution digitization, blockchain-based fund transaction networks, and fund servicing using distributed ledger technology, respectively.
Regulatory Progress and Market Growth
Enhanced regulatory clarity is supporting asset tokenization’s growth. The tokenized asset market is projected to grow explosively, from approximately $0.6 trillion today to nearly $19 trillion by 2033, spanning treasuries, fixed income, private credit, and more.
La Française Group, Azimut, and Alliance Bernstein are among the asset managers adopting blockchain solutions. For example, La Française has partnered with Allfunds Blockchain to digitize fund order management and settlement processes, aiming to reduce the cost of international fund distribution to professional investors. The Allfunds Blockchain network, being a shared ledger, provides greater transparency in the distribution process.
Deutsche Börse Group has acquired fund distribution platform Luxembourg-based FundsDLT, further solidifying the industry's commitment to blockchain technology. IZNES, a UCITS fund marketplace based on blockchain, already hosts €8 billion in assets. La Française, being a participant in IZNES, has some blockchain experience.
In summary, the current developments show a clear industry trajectory: asset managers are embedding blockchain and tokenization partnerships into their core operations to enhance product innovation, operational efficiencies, and client offerings, moving from pilot projects to institutional-scale blockchain adoption. These partnerships ultimately aim to reduce costs for all relevant participants, offering a promising future for the finance industry.
