GPF: Institutional investors and wealth managers expect increased use of blockchain

February 16, 2021

New research (1) with institutional investors and wealth managers reveals that over the next three years, 50% believe there will be a ‘dramatic’ increase in the use of blockchain technology within the asset management sector, and a further 44% think there will be a slight increase.

The study is from Global Palladium Fund (GPF), which recently listed four metal Exchange Traded Commodities (ETCs) and is the first ETC provider to use Blockchain technology to record bar information into Distributed Ledger Technology thereby providing an extra layer of security and proof of ownership to the Issuer. The use of Blockchain is in addition to the traditional recording processes used by the custodian.

When asked what they think is the main reason why blockchain will become increasingly important for asset managers, 51% of professional investors interviewed said it is part of the growing trend to provide more transparency around investments. Another 35% believe it is due to investors increasingly wanting more information on the investment vehicles they invest in, followed by 12% who said to meet growing regulatory demands. Some 2% believe the main reason for the growing use by asset managers is to reduce costs.

The findings reveal that 90% of professional investors believe that over the next five years, investment management firms will come under growing pressure from clients to use blockchain technology to provide greater security and transparency around their work.

Alexander Stoyanov, Chief Executive Officer of GPF said: “The asset management industry is becoming more competitive and challenging in terms of meeting client demands and regulatory requirements. We are the first ETC provider to make use of blockchain technology, using it to create an immutable record of metal ownership by the ETC. This is the first step in the use of blockchain to introduce greater transparency for investors in precious metals.”

Timothy Harvey, Chief Executive Officer and Founder of NTree, said: “Blockchain has many potential applications from trading through to reporting and regulatory requirements. In the long term, this will translate into greater efficiencies, transparency and cost savings.”

Global Palladium Fund (GPF) has four new metal ETCs (gold, silver, palladium and platinum) listed on the Deutsche Börse and London Stock Exchange. They have the lowest charges with total expense ratios (TER) ranging from 0.145% to 0.20%. Targeting Family Offices, wealth managers, institutional and other professional investors, the new physically-backed gold, silver, platinum and palladium ETCs will track the spot price of the respective metals they cover.

GPF’s new ETCs have a strong focus on ESG. LBMA-approved metal will be sourced from producers and suppliers who support the Sustainable Development Goals of the UN 2030 Agenda and other global initiatives in sustainable development and responsible mining.

NTree International Ltd, a specialist in marketing, distribution and investor engagement, is leading the distribution and rollout of Global Palladium Fund’s new metal ETCs. NTree has set up a dedicated brand, Metal.Digital as an education resource for professional investors with a focus on metals. On 17 February it is organising a webinar Blockchain and Distributed Ledger Technology - Transforming the Financial World to discuss how the uptake of blockchain and DLT within finance will speed up the digitalisation of the sector.

Capital at risk