Wonderful piece. Very well written and informative. I would be keen to understand how fee structures can be competitive on tokenised assets vs traditional assets. In your opinion, would tokenisation add additional cost layers in the short run whilst in the infancy of its adoption?
Thank you Hilmar. I believe this questions depends on the asset class and use case.
For illiquid assets you'd likely compare the tokenization process to setting up a traditional nominee structure, which is is costlier, slower, less flexible, and higher risk (because counterparty).
For capital market instruments like corporate bonds, there will be a substantial period of trial and error to find the best set-up, including regulatory framework and token validators. This introduces new costs in the interim. Post issuance, the benefits are clear straight away, particularly automated servicing & reconciliation.
Really solid piece Thibault! Helpful 101 overview for the new & curious and valuable insights for the folks in the weeds of it all!
Wonderful piece. Very well written and informative. I would be keen to understand how fee structures can be competitive on tokenised assets vs traditional assets. In your opinion, would tokenisation add additional cost layers in the short run whilst in the infancy of its adoption?
Thank you Hilmar. I believe this questions depends on the asset class and use case.
For illiquid assets you'd likely compare the tokenization process to setting up a traditional nominee structure, which is is costlier, slower, less flexible, and higher risk (because counterparty).
For capital market instruments like corporate bonds, there will be a substantial period of trial and error to find the best set-up, including regulatory framework and token validators. This introduces new costs in the interim. Post issuance, the benefits are clear straight away, particularly automated servicing & reconciliation.