Natixis Asset Management, which handles around $400 billion worth of assets, announced their investors successfully purchased shares in Natixis AM’s funds through the blockchain.
“We believe the potential for blockchain technology to enhance distribution mechanisms in the asset management industry is very significant,” Matthieu Duncan, CEO of Natixis Asset Management said while announcing the successful completion of the blockchain transaction.
The transaction was performed by investors logging into an app that transmits the order through blockchain technology to Natixis AM. The order is then confirmed, triggering the clearing and settlement processes, all of which is handled through the blockchain.
That significantly reduces administration costs and processing times while streamlining a range of funds and order-routing tasks by using blockchain technology to automate several processes in a secure manner, according to KPMG which collaborated with others to provide the blockchain infrastructure.
That blockchain being FundsDLT, a platform created by KPMG, InTech, and Fundsquare, specifically to allow asset managers to sell funds directly to investors. FundsDLT says in a press release:
“The messaging that must occur amongst the investor, the asset manager, the custodian bank, and the transfer agent is about to become much simpler. Whereas the time between an investor making a decision and a transfer agent executing it currently takes up to about six days, this new fund distribution platform will do it in hours. And in the not-too-distant future, seconds.”
“It is really exciting to be part of such a tremendous step forward. We not only replicated trades in the blockchain; we moved real cash and invested in a real fund. We are close to having an industrial product that could be used in different configurations: distributors, IFA, robo advisors and D2C,” said Said Fihri from KPMG Luxembourg.
It appears, therefore, some companies are now moving from proof of concept to real world trials, with blockchain products seemingly moving to production, ready for consumers to utilize.
That’s still at a very, very, early stage, but previous estimates suggested it would be 2019 before we see such real world transactions. It appears, however, that may begin as soon as this year and might perhaps become the story of 2018.