Luxembourg, 13 December 2017 - First announced in December 2016, FundsDLT is the first ever blockchain-powered solution built for asset managers. One year later, on 12 December 2017, fund professionals and fintech orbiters gathered at KPMG Luxembourg’s headquarters in Kirchberg to review FundsDLT’s progress, view a live demonstration, and discuss feedback from FundsDLT’s first tests performed earlier this year.
FundsDLT is the result of collaboration between Fundsquare, InTech, and KPMG Luxembourg. Its aim is to digitalise fund distribution by settling transactions on a distributed ledger, cutting out arduous processes of communication and approvals while maintaining a secure and searchable record that spans the entire distribution process. Ultimately, it means that fund shares can be issued directly to investors through an integrated and interoperable infrastructure.
FundsDLT has attracted a great deal of attention in its first year, attracting an observer committee of 50+ asset managers and industry professionals. It also took home the Most Innovative Fintech of the Year award by AGEFI in Paris and successfully carried out the first blockchain transaction for funds with Natixis Asset Management.
Fundsquare, which has taken the lead in designing the product, was represented at the event by Olivier Portenseigne, Managing Director and Chief Commercial Officer. Mr Portenseigne commented that “blockchain momentum in the fund industry is accelerating; we are almost there as this new step shows. Thanks to strong support from our working group, we are confident about going live with a minimum viable product and with the first asset managers during the second quarter of 2018.”
Also present was i-Hub CEO Pascal Morosini, who said, “we are pleased to be associated with this innovative product where we will play a key role in being the KYC Hub. This connects i-Hub’s digital KYC repository solution perfectly to a blockchain fund transaction.”
Bernard Simon of the Luxembourg Stock Exchange conducted a live demonstration of a fund subscription using FundsDLT’s mobile interface, commenting that “as Bitcoin future trading begins on the Chicago Board Options Exchange (CBOE) and distributed ledger technology is approved for unlisted French securities, blockchain has begun to become mainstream.”
From InTech, whose IT specialists are building FundsDLT, CEO Fabrice Croiseaux was present. He explained that “by hiding the underlying complexity behind the technology and providing a simple user interface, FundsDLT is one of the first platforms that allows non-specialists to benefit from the advantages of the blockchain technology.”
KPMG’s role in the project has been to lend its experience and expertise in the asset management industry in providing advice during the design and test phases of FundsDLT. It was represented at the event by Ravi Beegun, Partner; Said Fihri, Partner; and Eamonn Maguire, Global Head of Distributed Ledger Services. Mr Beegun pointed out that FundsDLT is an example of how technology and customer experience are forcing business models in the asset management industry to evolve. Mr Fihri echoed this message, saying, “asset managers need to transform themselves to operate in a digital and post-MiFID-II world. They can do so by leveraging on blockchain technology while mutualising transformation costs through a market infrastructure such as FundsDLT.” He added that a panel of asset managers and asset servicers has been discussing how they plan to use blockchain technology to improve client services.
Mr Maguire offered further insight about FundsDLT’s larger place in the fintech, and specifically the blockchain, revolution. “FundsDLT has demonstrated that blockchain technology can be applied to fund distribution and has the potential to reshape the investment industry, bringing important commercial benefits to industry participants,” he said.
The speakers seemed to agree on the brightness of FundsDLT’s future. The product is scheduled to go live next year and a legal entity will be created by Fundsquare for that purpose. Client onboarding is set to begin in the second quarter of 2018.
Visit http://fundsdlt.net/ for the latest updates and press releases.
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About KPMG Luxembourg
KPMG in Luxembourg provides a full range of audit, tax and advisory services to major national and international clients active in the financial, insurance, commercial and industrial sectors.
With more than 1,500 people, KPMG in Luxembourg is one of the country’s leading audit, tax and advisory firms. Our approach to relationships and service delivery is designed to help clients exploit new opportunities, improve performance and manage risk.
Fundsquare was constituted in June 2013 and was set up by the Luxembourg Stock Exchange in order to create a unique international market infrastructure that provides services to substantially support and standardise cross-border distribution of investment funds. The main objective of this utility is to facilitate the relationships between professional investors and funds and to allow them to meet current and future challenges of cross-border distribution. It provides a flexible and responsive infrastructure to enable operational effectiveness across the entire distribution chain. Fundsquare offers unique solutions for order routing management, information and regulatory compliance.
InTech is an IT company providing consulting and expertise in information technology. With more than 100 engineers, InTech helps their customers to create innovative services thru the use of emerging technologies and works on blockchain since 2013. InTech is a POST Luxembourg Group.
Belonging to the POST Luxembourg group, i-Hub provides a highly secure digital and international KYC repository. It allows the mutualisation of documents and data, including their collection, verification, validation, lifecycle management and storage in a digital form. It also provides a multi-device connection to KYC data and documents for financial and non-financial institutions and their underlying clients. i-Hub’s KYC solution removes the need for institutions and their clients to provide multiple copies of documents thus significantly mitigating risks and inefficiencies. It also simplifies client documentation collection therefore delivering significant operational efficiencies.
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