The digitisation of finance is ushering in new asset classes and new opportunities for investors and helping to create a more efficient, inclusive and sustainable future.
Put simply, the digitisation of finance is the automation of the processes involved in financial and investment transactions, with the ultimate end-point that financial instruments become programmable, which creates new ways of investing.
Lisa Wade, director of product development at NAB, says technology will open up a wider range of asset classes to investors, particularly by fractionalising large assets, that is by digitally dividing the asset into thousands or millions of investable units.
She uses the example of a large skyscraper, an investment that would be out of reach for the average investor.
But it’s possible to create a “digital twin” of the skyscraper, which holds all the paperwork that is associated with investing in the asset and all of the legals behind it embedded into a smart contract.