DLT and CDR shifting investment data ownership

Distributed ledger technology (DLT) and the consumer data right (CDR) legislation will transition the source of consumer investment data from product providers to consumers themselves, according to a digital wealth management platform founder.

Speaking at the IMAP InvestTech Virtual Conference, Stuart Holdsworth, Financial Simplicity chief executive, said the combination of the CDR and blockchain technology would afford consumers with the ability to extract their wealth management data and move it to where they want it to go.

“We think that combining that with personal portfolio management technologies, like Financial Simplicity, creates all sorts of wonderful opportunities, and all sorts of different types of advice models,” Holdsworth said.

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“It might not be a case of ‘I’m an adviser, I use a platform’, [it might be] ‘I use something that reads what my customers tell me’.”

He said the introduction of exchange traded funds (ETFs), separately managed accounts (SMAs) and fundamental indexing had propelled increased customer involvement in the investment process, a factor he said was driving the trend for customer data ownership.

“At the moment, a lot of the categorization of investments is done either by platforms, product providers or research houses, but what we're starting to find is that the consumers are getting involved in this,” he said.

But blockchain wealth management would not be one size fits all, Holdsworth said.

“We think there’ll be various different specialists doing various different components of investment management and they will have access to that type of information in a broadly available way,” Holdsworth said.

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