F E A T U R E
F E A T U R E
What are the benefits ?
DLT , DeFi and digital ( crypto ) assets have the potential to accelerate and reduce the cost of asset transactions . DLT essentially acts as a digital system for recording transactions . This means it offers ‘ immutable records ’ – unchangeable digital logs stored on a distributed ledger or Blockchain – and so every asset transaction or change in ownership is documented in a permanent , verifiable manner . This can ensure greater transparency and security , whilst simplifying due diligence and transaction costs .
By converting physical or illiquid assets into ‘ digital tokens ’ that represent ownership , DLT also enables currently illiquid assets to be traded on Blockchainbased platforms – opening up opportunities to establish entirely new asset classes . Illiquid assets could be traded in a similar way to high-frequency trading , with more dynamic , AI-enabled investing strategies . It also offers the possibility of fractional investment .
For example , gilts could be used to fund capital investments – such as UK critical national infrastructure – whereby previously illiquid large infrastructure projects are fractionalised using tokens and linked to a UK digital gilt . This would enable UK national infrastructure to be funded by a larger number of investors , including private equity and global retail investors . At the point of selling , the larger size of the capital pool and the liquidity available could support getting the target sale price of these assets , with a new range of DLT-backed www . intelligentfin . tech
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