[ M A R K E T
markets previously considered off-limits,”
said King.
However, the embrace of blockchain by
emerging markets has not been without
its challenges. The first is regulatory.
“Progressive markets that are
agile enough to embrace the
full promise of blockchain
will readily leap-frog those
trying to retro-fit the
technology to old processes.”
STEVE KING, CHIEF INFORMATION
OFFICER, EQUICHAIN
Market participants face huge liabili-
ties under UCITS V and the Alternative
Investment Fund Managers Directive
(AIFMD) whereby they must ensure that
assets held in custody and sub-custody
are done so safely. Depositaries may be
uncomfortable in allowing client assets to
R E V I E W
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T E C H N O L O G Y
be exposed to any risks incurred through
adopting nascent technology. Existing
regulation is unlikely to be the only prob-
lem for potential blockchain adoption.
Some have warned excessive legislation
or guidance on blockchain introduced
under the auspices of international bodies
or by major markets could undermine the
technology’s development in emerging
markets.
Emerging security concerns
The notable lack of standards around
blockchain is nothing new, but it will
undermine progress in emerging markets.
A number of institutional investors will
not have concentrated exposures to a sin-
gular market, but rather a region. Unless
some sort of industry initiative delivers a
comprehensive, cross-border blockchain
standard, the existing problem