Nov 14, 2023 - Business

JPMorgan, Apollo reimagine wealth management with tokenization

Illustration of a hand holding out a glowing cube.

Illustration: Aïda Amer/Axios

JPMorgan and Apollo are teaming up on a project that unlocks the future of wealth management with blockchain technology and tokens.

Why it matters: Investors like to see all their positions, all their risks, all their wins and losses, in one place at the same time. The two financial giants believe that blockchains could make that more feasible and flexible via their collaboration.

Driving the news: The pair unveiled the proof-of-concept Tuesday at the Singapore Fintech Festival, as part of the Monetary Authority of Singapore's initiative.

What they're saying: "Today in 2023, in collaboration with Apollo, we have a new, bold vision: Creating a step change in the asset and wealth management industry through a new paradigm for portfolio management," Tyrone Lobban head of JPMorgan's Onyx Digital Assets said.

In the weeds: They aimed to demonstrate that a portfolio manager could manage a large number of discretionary portfolios, made up of a spectrum of tokenized traditional and alternative investments across blockchains, all while maintaining the uniqueness of each investor's account.

  • Think separately managed accounts (SMAs) at scale, with lower barriers to entry.

Of note: They also built a portfolio construction and management prototype, called Crescendo, to bring that concept to life.

The intrigue: The hot topic right now is getting a bitcoin exchange-traded fund, because investors want to buy bitcoin in their brokerage accounts, not directly on blockchains. Now, investing giants want to put actual blockchains in brokerage accounts.

Between the lines: JPMorgan and Apollo are playing to their respective strengths, model portfolios and alternative investments.

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