Britain’s Financial Conduct Authority (FCA) has unveiled plans to encourage asset managers to “tokenise” funds on public blockchains such as Ethereum, aiming to engage a younger generation of investors.
Key points:
- Tokenisation would allow crypto tokens representing fund shares to be issued on public blockchains rather than private ones.
- FCA sees potential for greater efficiency, lower management costs, and fundamental shifts in asset management.
- The consultation also explores using stablecoins as settlement for tokenised funds.
- Nearly 47% of trading app users in the UK are aged 18-34, highlighting the need to meet changing investor expectations.
- Future reviews may consider letting regulated funds invest directly in crypto assets.
Simon Walls, FCA’s Executive Director of Markets, said:
“Tokenisation has the potential to drive fundamental changes in asset management, with benefits for the industry and consumers.”
This move is part of the UK’s strategy to enhance competitiveness in digital assets and bridge traditional finance with emerging blockchain solutions.