[ I N D E P T H | D I G I T A L A S S E T S ] based on human fraud . It ’ s not malfunction of the blockchain but human misbehaviour , in combination with a lack of regulation , for example in the US . Therefore , governance is key to ensure that the trust our investors have in us as an asset manager can be fulfilled .”
Impacts on infrastructure Market infrastructure is being reshaped by digital assets through the introduction of new methodologies for ownership , transferability and transparency . Unlike traditional financial assets , digital assets leverage blockchain technology , enabling peer-to-peer transactions without the need for intermediaries .
The continued evolution of digital assets is helping catalyse the transformation of market infrastructure , shaping a way for a more inclusive , efficient and resilient financial landscape . However , there are still limitations as to how much can be gained in terms of infrastructure in the traditional financial landscape – one being the cost of any change .
“ Typically , trading a digital asset requires new functionality such as a digital custodian , new post-trade integrations and / or trading connectivity – anytime a traditional financial firm has to put something like that in place , there has to be a really strong commercial case for why they do that because it ’ s timely , costly and expensive ,” explains Duncan Trenholme , global co-head of digital assets at TP ICAP .
“ The reality is , if you are going to bring liquidity in from the traditional markets then the new digital trading experience has to be dramatically efficient or cheaper for clients to change their infrastructure .”
With developments linked to blockchain and digital assets surging and subsequently presenting various use cases and areas of improvement for the traditional finance landscape , the
“ If you are going to bring liquidity in from the traditional markets then the new digital trading experience has to be dramatically efficient or cheaper for clients to change their infrastructure .”
DUNCAN TRENHOLME , GLOBAL CO- HEAD OF DIGITAL ASSETS AT TP ICAP
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