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.
“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.
AUTHOR
Liam Cormican
Recommended for you
With AMP advisers moving to Entireti and Insignia being the subject of a private equity bidding war, how can deals be navigated to ensure minimal stress and uncertainty for staff and advisers?
There are seven key mistakes that financial advice businesses need to steer clear of in 2025 to avoid hindering their business growth and profitability, according to Adviser Ratings.
The FAAA has secured CSLR-related documents under the FOI process, after an extended four-month wait, which show little analysis was done on how the scheme’s cost would affect financial advisers.
While advisers are increasingly eyeing private markets and alternative investments, two reports have underlined the lack of investor understanding that persists among both advisers and clients.
