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January 20, 2023

Beyond Asset Tokenisation

We partnered with HSBC to reflect on some key drivers, considerations and opportunities which may arise on the journey through the next evolution of asset servicing. Included are some key trends that we believe are meaningful to institutional and wealth investment communities.

By Dan Sleep,
Digital Assets and Financial Markets Specialist, Asia Pacific

We are living through an era of deep digital transformation, digital asset innovation and climate crisis.

The need to reimagine the way we live, and work is paramount to remaining effective and efficient in a future state with only one constant – change.

Macro-economic, digital, and environmental factors will continue to have profound impacts on the asset servicing landscape. As the financial markets ecosystem evolves to embrace new technologies and partnerships, firms must innovate in pursuit of new value propositions for our clients and partners.

In this paper, we partnered with HSBC to reflect on some key drivers, considerations and opportunities which may arise from the next evolution of asset servicing – looking beyond enabling capabilities such as tokenisation, to new horizons for institutional grade products and solutions across the investment community.

We unwrap some of the key trends in the realms of ESG, Digital Assets, Voluntary Carbon Markets and contemplate the path forward in the nurturing of digital ecosystems, how that may influence the development and delivery of new products across the asset class spectrum.

Additionally, we outline what we believe to be some of the key ingredients and resources for participants – investors, services providers - to navigate that digital journey ahead.

Key among those are:

  1. DLT technologies have the power to transform value chains and processes as we know them, providing transparency and immutability at the core. Enabling new generations of products and asset classes.
  2. Firms cannot any longer expect to keep performing the same roles without evolving to new client needs, new entrants and disruptors will innovate and compete.
  3. The ESG data and product landscape is complex and will present challenges as well as opportunities for many in the coming years.
  4. The emergence and tuning of regulatory frameworks across the globe will have a strong influence over the maturity of the digital landscape as we know it.
  5. Partnerships and collaborations are powerful, network effects and scale can only truly be achieved in interconnected ecosystems that transcend traditional barriers and silos.

Download the paper to learn more.

 

Dan Sleep portrait

Dan Sleep

Digital Assets and Financial Markets Specialist, Asia Pacific
Dan Sleep is a Digital Assets and Financial Markets Specialist, Asia Pacific at Northern Trust. He is responsible for assessing the impact of regulatory and market infrastructure change to Northern Trust’s operating model and identifying innovative operating structures.
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© 2023 Northern Trust Corporation. Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A. Incorporated with limited liability as an Illinois corporation under number 0014019. Products and services provided by subsidiaries of Northern Trust Corporation may vary in different markets and are offered in accordance with local regulation. This material is directed to professional clients only and is not intended for retail clients. For Asia-Pacific markets, it is directed to expert, institutional, professional and wholesale clients or investors only and should not be relied upon by retail clients or investors. For legal and regulatory information about our offices and legal entities, visit northerntrust.com/disclosures. The views, thoughts, and opinions expressed in the text belong solely to the author, and not necessarily to the author's employer, organization, committee or other group or individual. The following information is provided to comply with local disclosure requirements: The Northern Trust Company, London Branch, Northern Trust Global Investments Limited, Northern Trust Securities LLP and Northern Trust Investor Services Limited, 50 Bank Street, London E14 5NT. Northern Trust Global Services SE, 10 rue du Château d’Eau, L-3364 Leudelange, Grand-Duché de Luxembourg, incorporated with limited liability in Luxembourg at the RCS under number B232281; authorised by the ECB and subject to the prudential supervision of the ECB and the CSSF; Northern Trust Global Services SE UK Branch, UK establishment number BR023423 and UK office at 50 Bank Street, London E14 5NT; Northern Trust Global Services SE Sweden Bankfilial, Ingmar Bergmans gata 4, 1st Floor, 114 34 Stockholm, Sweden, registered with the Swedish Companies Registration Office (Sw. Bolagsverket) with registration number 516405-3786 and the Swedish Financial Supervisory Authority (Sw. Finansinspektionen) with institution number 11654; Northern Trust Global Services SE Netherlands Branch, Viñoly 7th floor, Claude Debussylaan 18 A, 1082 MD Amsterdam; Northern Trust Global Services SE Abu Dhabi Branch, registration Number 000000519 licenced by ADGM under FSRA #160018; Northern Trust Global Services SE Norway Branch, org. no. 925 952 567 (Foretaksregisteret), address Third Floor, Haakon VIIs gate 6 0161 Oslo, is a Norwegian branch of Northern Trust Global Services SE supervised by Finanstilsynet. Northern Trust Global Services SE Leudelange, Luxembourg, Zweigniederlassung Basel is a branch of Northern Trust Global Services SE. The Branch has its registered office at Grosspeter Tower, Grosspeteranlage 29, 4052 Basel, Switzerland, and is authorised and regulated by the Swiss Financial Market Supervisory Authority FINMA. The Northern Trust Company Saudi Arabia, PO Box 7508, Level 20, Kingdom Tower, Al Urubah Road, Olaya District, Riyadh, Kingdom of Saudi Arabia 11214-9597, a Saudi Joint Stock Company – capital 52 million SAR. Regulated and Authorised by the Capital Market Authority License #12163-26 CR 1010366439. Northern Trust (Guernsey) Limited (2651)/Northern Trust Fiduciary Services (Guernsey) Limited (29806)/Northern Trust International Fund Administration Services (Guernsey) Limited (15532) are licensed by the Guernsey Financial Services Commission. Registered Office: Trafalgar Court, Les Banques, St Peter Port, Guernsey GY1 3DA. Northern Trust International Fund Administration Services (Ireland) Limited (160579)/Northern Trust Fiduciary Services (Ireland) Limited (161386),  Registered Office: Georges Court, 54-62 Townsend Street, Dublin 2, D02 R156, Ireland.