Blockchain access added to $3.8bn private markets fund
Sygnum Bank, Hamilton Lane, and Apex Group have launched a cross-industry project to expand access to private markets using blockchain.
The groups have launched a new share class registered on direct ledger technology (DLT), which automates and integrates traditionally separate fund management functions.
The first fund to feature the new share class is Hamilton Lane’s Luxembourg-based Global Private Assets fund, which has had an average annual performance growth of 14.6 per cent since 2019.
Sygnum, a digital assets banking group, will provide the technology, which is set to bring down the minimum investment entry point significantly lower than traditional private market funds.
However, the DLT-registered shares will only be available to Sygnum professional, institutional and corporate clients.
Hmailton Lane will serve as investment manager for the new offering, with Apex Group acting as transfer agent and fund administrator and FundRock-LRI as Alternative Investment Fund Manager.
Speaking to City A.M., Hamilton Lane CEO Erik Hirsch emphasised the importance of blockchain technology for the group’s strategy of bringing minimum investments down, due to the ability to split shares of investments into token.
However, he did acknowledge some shortfalls with the technology, especially how underdeveloped the market was.
“What doesn’t exist today is there’s not a vibrant kind of buyer and seller market, there’s just not enough volume today,” he said.
Nevertheless, Hirsch was bullish on the technology, complaining that it had been “unfairly linked to crypto” and “they only share the same spine in the blockchain technology”.
Victor Jung, head of digital assets at Hamilton Lane, said: “We strongly believe that tokenisation has the potential to transform the way investors gain access to the historically strong returns and performance opportunities within the private markets, and are delighted to announce this digital-native, institutional-grade offering with Sygnum and Apex.
“This joint initiative with the Swiss Private Wealth team underscores the region as a leading digital asset hub that we believe will serve as a catalyst for broader adoption within the banking and wealth management industry. We would like to invite the community to join us in this movement.”