This rather punchy heading was in a report from Deloitte when they analysed the potential impact Blockchain could have on the second largest mutual fund market in the world.The ability for Blockchain’s to increase transparency reduce the number of intermediaries - transfer agencies, custodians, settlement agents, administrators, fund accounting etc to reduce the cost of managing your savings and pension funds.
It is rather ironic that regulators like SEC and governments have been very cautious about using Blockchain and Cryptocurrencies due to the risks that they may present. However, it could be compliance that drives greater adoption, as they realize the cost savings, improved resilience (as data is not held in one location), greater transparency and being able to treat customers fairly. Digital assets that are able to track who owns what in Real Time and to be able to the calculate dividends, interest payments and rental income entitlement based on the number of minutes one holds an investment, not to mention being able to trade 24/7 are all highly attractive advantages that Blockchain technology and Digital Assets offer the mutual fund industry.
Indeed one survey last year claimed costs savings could be $1.9Billion globally, having index funds that automatically adjust and manage themselves, having funds that manage themselves using Smart Contracts and funds that could be priced and traded continually are just some of the changes that are coming...
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