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The major traditional exchanges have adapted well to the migration of transactional activity to other trading platforms, notably by developing their data and post-trade revenues, so it is surprising that they remain indifferent to tokenisation. With some notable exceptions, traditional stock exchanges have shown little interest in the revolutionary potential of issuing, trading and servicing tokens. Explanations for this indifference vary. Some say the existing markets (especially equity trading) are already so efficient that tokenisation is unnecessary. The fact that exchanges which have invested in tokenisation have yet to earn a return, and are now making economies, is not encouraging. If tokenisation ever does take off, add some larger exchanges, they could simply acquire the successful platforms. The long lists of intermediaries that stand between issuers and investors – global brokers, local brokers, clearing houses, securities depositories, payments banks, custodian banks and so on – also have limited incentives to encourage the emergence of peer-to-peer exchanges. So even the leading traditional stock exchange groups are focusing on a narrow range of token opportunities, such as cryptocurrencies and privately managed assets, and leaving potential lavish operational cost savings and new product earnings untouched. Dominic Hobson, co-founder of Future of Finance, moderated a discussion of about traditional stock exchanges and tokenisation with Marco Kessler, business head of digital securities at six Digital Exchange SDX, Hirander Misra, chairman and CEO of GMEX Group, Ricardo Correia, a partner in the financial services practice at Bain and Company, Benedikt Schuppli, co-founder and CBDO at Obligate and Miryusup Abdullaev, managing director of the Deutsche Börse Digital Exchange (DBDX).

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A Future of Finance Interview with Apex Group founder and CEO Peter Hughes and Head of Digital Assets Bruce Jackson.

The Apex Group has grown from an idea in the minds of two people in Bermuda just over 20 years ago to a global fund administration business employing 13,000 people across 112 offices around the world to look after assets under administration worth more than US$1 trillion. Such rapid expansion by acquisition was made possible by the support of major private equity investors – they include Genstar, Carlyle and Mubadala – but Apex is more than a classic roll-up story. The firm has retained its original bias to alternative strategies, but has moved far beyond fund accounting, transfer agency and management company services to embrace capital introductions, depositary and custody services and an Environmental, Social and Governance (ESG) ratings and advisory service. But what really distinguishes Apex from other fund administrators is its embrace of new technologies in general and blockchain technologies in particular. It has not only supported several tokenised fund issues but invested in a tokenisation engine (the Luxembourg-based Tokeny) and in the London-based FundAdminChain (which began as a fund tokenisation platform but morphed into an automated investor due diligence checking and on-boarding service). No other fund administrator has shown a comparable level of material commitment to a tokenised future for the funds industry. As Dominic Hobson, Co-founder of Future of Finance, found out when he spoke to Apex Group founder and CEO Peter Hughes and Head of Digital Assets Bruce Jackson, the enthusiasm of the senior management for tokenisation is not about intellectual curiosity but long-term survival and success.

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