Custodian banks, transfer agents and central securities depositories (CSDs) are the intermediaries most at risk from a transition to digital issuance and investing, according to a poll of attendees at the Future of Finance event “Embrace this digital future or die,” held in London on 20 September 2022. Three out of four attendees at the event, which was focused on the impact of digital issuance and investing on the traditional asset management industry, also thought digital issuance and investing is either imminent or will happen in the near future. If they are right, the threat will materialise shortly. The catalysts of change identified by attendees included central bank digital currencies (CBDCs), and engagement by major corporate issuers and asset managers. The chief constraint on embracing digital issuance and investing wholeheartedly is the continuing lack of legal and regulatory certainty in digital asset markets. Levels of confidence in the technology, as measured by the willingness to rely on smart contracts to automate transaction processing and asset servicing, also need to rise. The earliest asset classes to be tokenised are expected to be bonds and money market instruments, followed by privately managed assets and real estate.
Click below to see the results of this Future of Finance Poll.