No blockchain bonanza in private markets, yet

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One of the most fun parts of playing the Football Manager computer game is discovering wonderkids.

These are young players who develop into superstars as the seasons tick by. They are typically highly rated prospects in real life too, but while the same players always fulfill their potential in the game, things are less black and white in reality.

Some of the players tipped by the game makers to dominate world football quickly drop out of the professional ranks in reality, underscoring just how hard prediction is.

Blockchain tech has been predicted to revolutionize all sorts of industries for a while now, including private markets. But as today’s featured story shows, it’s far from clear whether that much-hyped potential will be fulfilled any time soon.

Today we look at:

• Blockchain’s big hype, little substance in private markets
• South Korea’s Webtoon filing for an IPO in the US
• Other newsy highlights such as Grab scrapping its e-wallet service in Vietnam and eFishery securing a US$30 million loan from HSBC Indonesia

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Token time for private-market assets?

Image credit: Timmy Loen

There’s been a lot of hype around how blockchain or distributed ledger technology (DLT) could help better manage private-market assets, but industry insiders are still far from convinced.

DLT is expected to liberalize illiquid, disparate, and chunky assets by breaking them into digital tokens, but adoption of this tech has been slow.

• High hopes: Proponents of DLT say that by tokenizing equity, it can reduce costs on things like physical documentation, save time to make transfers of asset ownership, and even do away with a private company’s need for a central securities depository that keeps track of who owns what.
• By the same token: However, some skeptics argue that DLT would be more useful for private funds than equities. John Allan, head of the innovation and operations unit at The Investment Association, which represents investment managers in the United Kingdom, believes the “lowest use case (for DLT) is in the equities market, which is already fantastically efficient from a trading perspective.”
• Commitment: Adam Belding, chief architect at trading solutions provider Calastone, said companies mistakenly look at the promised benefits of DLT discussed online or in the media without considering the specific needs of their business. Rather than tokenizing fund units, applying DLT and tokenization at all levels of a fund would create a “much more fundamental transformation,” he said.

Read more: Private markets slow to adopt tokenization, still seeking clear use case

Webtoon’s next chapter: US listing

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