Hamilton Lane Tokenizes Funds to Offer Individual Investors Access Private Markets

Hamilton Lane, a global private markets investment firm, formed a partnership deal with digital asset securities firm Securitize to tokenize three of its investment funds on Wednesday. 

Through the partnership, funds to be tokenized include unlisted equities, private credit, and secondary transactions.

Hamilton Lane, which has $835 billion in assets under management, plans to give qualified U.S.-based investors access to funds through providing exposure to direct equities, private credit, and secondary transactions, which will be tokenized via Securitize’s blockchain-based digital transfer agency.

Hamilton’s tokenized funds are expected to be available by the fourth quarter, enabling a broader investor base to access the funds. Customers will still need to be accredited, which means those with a net worth of more than $1 million or income above $200,000.

Victor Jung, Head of Digital Assets at Hamilton Lane, commented about the development: “This collaboration with Securitize is our latest step toward enabling access to the strong returns and performance opportunities generated within the private markets space for a newer set of investors while increasing usability and transparency through the use of blockchain technology.”

The new tokenized funds highlight Hamilton’s commitment to expanding ease of access to the private markets through the use of blockchain technology. Private-equity investments are generally accessible only to institutional investors or ultra-high-net-worth investors. But blockchain has opened up the access of private-market strategies to retail investors.

Therefore, converting funds into security tokens enables individual investors to place money in assets previously only accessible to institutions. It reduces issuance and administration costs and enables fractional ownership.

Hamilton Lane’s move follows the announcement last month when KKR tapped blockchain technology further to open its private equity strategy to individual investors. The developments signal a series of asset management firms using intermediaries to expand access to funds to high net-worth individuals and accredited investors.

Other asset managers, like Partners Group, Investcorp, and Temasek-backed Mapletree, also tokenized their funds recently, as they know that individual investors will increasingly drive their growth investments.


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Coinbase-backed Securitize secures $48M in Series B funding

Morgan Stanley has made its first capital investment foray into the blockchain space, co-leading a $48 million funding for Securitize.

According to a release issued on Monday, the Coinbase-backed asset tokenization outfit has completed a Series B funding round that drew participation from Morgan Stanley Tactical Value-managed investment funds and Blockchain Capital.

Other participants in the funding round included Sumitomo Mitsui Trust Bank (SMTB), Emin Gün Sirer’s Ava Labs, and venture capital fund IDC Ventures, among others.

The oversubscribed Series B round also saw participation from previous Securitize backers like Ripple and Borderless Capital.

Monday’s Series B funding announcement comes barely a month after successfully closing a $12.75 million Series B funding round.

As with other Securitize capital raises, the Series B investors will receive their shares as digital assets issued by the firm. According to the release, the asset tokenization platform already has over 300,000 verified investors.

In March, Securitize collaborated with SMTB to launch Japan’s first “A-1” rated security token.

Related: Japanese bank Sumitomo Mitsui launches the country’s first ‘a-1’ rated security token

As part of its investment, Morgan Stanley Tactical Value co-head Pedro Teixeira will join the Board of Directors at Securitize.

Commenting on Morgan Stanley’s first blockchain investment, Teixeira was quoted in the announcement as saying that the investment bank was keen on assets with long-term potential, adding:

“Our investment in Securitize is a sign that we believe in the growth and adoption of digital asset securities.”

Securitize CEO Carlos Domingo also echoed Teixeira’s comments stating that VC funding for the company demonstrates the growing popularity of digital asset securities among legacy finance stakeholders.

As previously reported by Cointelegraph, Morgan Stanley introduced a Bitcoin (BTC) investment product for rich clients back in March. The $4 trillion wealth management giant in April expanded its BTC exposure for wealthy clients to 12 investment funds.