The Crypto Roundup: 27 November 2023 | CryptoCompare.com

Investment managers in the United Kingdom are receiving regulatory encouragement to adopt blockchain technology to tokenize funds, moving away from traditional record-keeping methods.

A report from the Investment Association highlights that tokenization of funds, using distributed ledger technology (DLT) to issue tokenized units or shares, can significantly enhance the efficiency and transparency of the financial industry.

The report points out that a shared real-time record-keeping system for all parties involved in servicing the fund can lower administration costs, streamline the reconciliation process, and allow for faster settlements.

It also lays out principles for the implementation of tokenized funds, which include maintaining relevance to both domestic and international investors, and not limiting the focus to just the investment asset manager industry.

Moreover, the report discusses the necessity of a roadmap for implementation, along with a focus on competitiveness and efficiency in the sector. It specifies that the fund must be established in the UK, be authorized by the FCA, and comply with traditional financial industry standards, while legal and regulatory rules will remain unchanged.

Sarah Pritchard, executive director of markets and international at the Financial Conduct Authority (FCA) has said the regulator wants to “support firms to implement technological solutions which enhance and strengthen the UK’s asset management industry, while addressing risks and potential harms.”

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• Source: https://www.cryptocompare.com/email-updates/daily/2023/nov/27/