It is possible to offer investors more choices and investments that better fit their risk profiles.

This helps to explain why there is a considerable amount of work being carried out, but yet to be announced, by large asset managers looking to tokenise their mutual funds and property owners exploring how to tokenise Real Estate portfolios. Given millennials increasingly are ‘practically living their lives’ on mobile phones (in terms of ordering goods and services), mutual fund managers are looking at ways to offer their funds in a digital format so enabling them to trade 24/7 and be made available to these younger, new investors, many of whom do not wish to deal via an IFA or broker-dealer, but go direct. 

For commercial property owners, they own buildings where different types of tenants potentially offer various risk profiles. A building in the middle of a city, such as the Shard, will have a combination of occupants e.g. retail, offices, residential, dining and even a hotel. By tokenising the building, it would be possible for an investor to have exposure to all of these types of tenants and income profiles separately, as opposed to simply investing in the mix of receipts from the various tenants. Alternatively, if you look at a publicly quoted company such as Amazon, by tokenising its shares it potentially would be possible to give token-holders access to specific assets of the company. Investors could buy tokens in Prime and the ‘online’ (original Amazon business) or the hugely successful Amazon cloud services division or Blue Origin, Amazon’s space exploration division. Not only does this offer investors access to different risk profiles and cash flows but it could enable a company to raise capital using tokens from different investors.