Tokenisation could transform the asset management industry, delivering cost savings of over $135 billion, according to research from global funds network Calastone.
As fund processing costs are expected to rise by 32% over the next three years, the report highlighted how digitising asset ownership through blockchain-based tokens could help firms modernise and streamline operations.
The study, “Decoding the Economics of Tokenisation: Transforming Cost Dynamics in Asset Management”, is the “most in-depth economic analysis of fund operating costs to date”, stated Calastone. Conducted with 26 global asset managers across the UK, Europe, Asia and the US, it explores how tokenisation can eliminate inefficiencies in fund issuance, administration, and distribution while significantly reducing operational expenses. By adopting tokenisation, asset managers could cut costs by 23%, improving overall profitability and speeding up fund launches, according to the research.
Tokenisation could drive a total P&L improvement of up to $7.9 million per fund, including revenue increases of up to $4.2 million per fund. It also has the potential to reduce the standard 12-week fund launch process by three weeks, giving firms a competitive edge. Seed funding requirements, which currently average $50.3 million per fund, could be reduced by 24%, helping firms launch funds more efficiently and with lower financial risk.
Brian Godins, chief commercial officer at Calastone, commented: “Tokenisation is already becoming a core pillar of strategy for asset managers, offering a path to greater efficiency, flexibility, and competitiveness. Our research highlights the scale of the opportunity, with tokenisation capable of unlocking over $135 billion in cost savings and streamlining fund issuance, administration and distribution.
Godins added: “While adoption will be incremental, the direction of travel is clear—tokenisation represents the next stage in the evolution of investment vehicles. At Calastone, we are committed to supporting this transformation, equipping asset managers with the tools and expertise to fully harness the value of tokenisation.”As part of its push to help firms embrace digital innovation, Calastone’s Digital Investments solution provides asset managers with the necessary framework to bring tokenised investment vehicles into production while also delivering immediate cost optimisations.
