Key Takeaways
- • DigiFT published takeaways from a Vault Summit Singapore panel examining how institutions decide whether on-chain uses of tokenised assets are suitable for capital allocation.
- • The panel argued that an acceptable underlying asset does not make every strategy built around it investable, since collateralisation, borrowing and reinvestment change the nature of the exposure.
- • Tokenisation may improve on-chain transferability of a fund holding but does not necessarily change the underlying fund's redemption timetable, creating a liquidity mismatch for strategies needing cash before redemptions.
- • Institutions must distinguish between software providers that let investors manage their own portfolios and providers making ongoing investment decisions, since responsibility and oversight requirements differ.
- • Per the panel, a successful pilot is not sufficient evidence for larger allocations; institutions require proof of scalability, withdrawal performance and operational continuity under stress.
Summary
DigiFT has published insights from a Vault Summit Singapore panel on the use of tokenised assets in institutional investment strategies, according to the published takeaways. The discussion centred on how institutions determine whether on-chain uses of assets are suitable for capital allocation, and examined the shift from simply issuing tokenised fund interests to using those holdings in financing, collateral and portfolio construction.
A central theme was that the acceptability of an underlying asset does not automatically extend to every strategy built around it. Once a fund holding is pledged as collateral, borrowed against or combined with other positions, an institution is assessing the full exposure created by the strategy. An institution may be comfortable owning a fund directly while rejecting a leveraged structure linked to the same fund, because financing and reinvestment change the exposure's nature.
Liquidity was another focus. The panel noted that tokenisation may improve on-chain transferability but does not necessarily alter the redemption timetable of the underlying fund, so a token may trade outside market hours while the underlying asset remains subject to conventional withdrawal schedules. Where a strategy requires cash before redemptions can be processed, allocators must determine whether another liquidity source exists and whether it would remain reliable under stress. The panel also addressed curation: once assets are assembled into a portfolio, decisions on selection, weightings and rebalancing resemble traditional investment management. Institutions must therefore distinguish providers offering software for self-directed portfolio management from those making ongoing investment decisions, as the responsibilities and oversight requirements differ.
The panel further highlighted safeguards required before moving activity on-chain. Efficient settlement or collateral use may offer an incentive, but does not remove the need for clear claims on assets, governance processes and reliable reporting. Smart contracts and wallet access were identified as additional operational risks, alongside custody, reporting and continuity during market disruption. Panellists argued that a successful pilot should not be treated as sufficient evidence for a larger institutional allocation; investors need proof that a strategy can operate at intended size, meet withdrawal terms and function during disruption. Operational records, transaction data and reporting history were cited as the evidence institutions use to judge readiness.
Participants included Henry Zhang, Founder and Group CEO of DigiFT; Feifei Zhang, Co-Founder, CFO and CIO of Anthea; Jasmine J., Head of Tokenisation Ecosystem at Fidelity Digital Asset Management; and Ka Yan Chan, who leads digital assets for UBS in Asia-Pacific. The session was moderated by Aravind Srinivasan, who leads GSR's systematic over-the-counter business. The published conclusions state that for tokenised assets to attract institutional capital, market participants must explain who makes investment decisions, how liquidity works and what the operating record shows.
A central theme was that the acceptability of an underlying asset does not automatically extend to every strategy built around it. Once a fund holding is pledged as collateral, borrowed against or combined with other positions, an institution is assessing the full exposure created by the strategy. An institution may be comfortable owning a fund directly while rejecting a leveraged structure linked to the same fund, because financing and reinvestment change the exposure's nature.
Liquidity was another focus. The panel noted that tokenisation may improve on-chain transferability but does not necessarily alter the redemption timetable of the underlying fund, so a token may trade outside market hours while the underlying asset remains subject to conventional withdrawal schedules. Where a strategy requires cash before redemptions can be processed, allocators must determine whether another liquidity source exists and whether it would remain reliable under stress. The panel also addressed curation: once assets are assembled into a portfolio, decisions on selection, weightings and rebalancing resemble traditional investment management. Institutions must therefore distinguish providers offering software for self-directed portfolio management from those making ongoing investment decisions, as the responsibilities and oversight requirements differ.
The panel further highlighted safeguards required before moving activity on-chain. Efficient settlement or collateral use may offer an incentive, but does not remove the need for clear claims on assets, governance processes and reliable reporting. Smart contracts and wallet access were identified as additional operational risks, alongside custody, reporting and continuity during market disruption. Panellists argued that a successful pilot should not be treated as sufficient evidence for a larger institutional allocation; investors need proof that a strategy can operate at intended size, meet withdrawal terms and function during disruption. Operational records, transaction data and reporting history were cited as the evidence institutions use to judge readiness.
Participants included Henry Zhang, Founder and Group CEO of DigiFT; Feifei Zhang, Co-Founder, CFO and CIO of Anthea; Jasmine J., Head of Tokenisation Ecosystem at Fidelity Digital Asset Management; and Ka Yan Chan, who leads digital assets for UBS in Asia-Pacific. The session was moderated by Aravind Srinivasan, who leads GSR's systematic over-the-counter business. The published conclusions state that for tokenised assets to attract institutional capital, market participants must explain who makes investment decisions, how liquidity works and what the operating record shows.
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