Foreword

This report is about the development of digital assets, cryptocurrencies and tokenization and how that all-important confidence is established.

Thank you for your interest in digital assets and the role of digital asset exchanges, custodians and the value digital assets offer to investors looking to diversify. 

For any currency, digital or otherwise, confidence in the integrity of it is essential. History offers numerous examples of what happens when that confidence is lost. This report is about the development of digital assets, cryptocurrencies and tokenization and how that all-important confidence is established.

It’s clearly evident that as an asset class, digital assets are coming of age. After a shaky start just over ten years ago, it has grown into a multi-billion-dollar asset class offering both performance and opportunity for portfolio diversification. It is a compelling proposition. 

But to understand the future potential, one should hear how the roots of the industry took shape. We start this report by taking a quick look at the background and then move on to examine the role of digital asset exchanges and custodians, including the challenges they face and the solutions. This section draws on interviews with London Stock Exchange Group (LSEG) Technology, AAX, and Koine Money Limited (Koine). 

The report then looks at the role played and issues faced by digital asset managers — after all, they’re helping guide smart money into the space. Of course, we couldn’t leave you without insights into  current trends and how the industry is creating value through the main digital assets available, along with a look at the investors, and their appetite in this space. 

We want to thank AAX for sponsoring this report. It is the first cryptocurrency exchange in the world to use the same matching engine as the London Stock Exchange and other traditional financial markets. Its exchange infrastructure is provided by LSEG Technology, which is also used by the Oslo Stock Exchange and the Johannesburg Stock Exchange. 

As the industry continues to grow, and not without its growing pains, we hope that our report will help you understand the dynamics better. After all, it is reshaping global finance as we know it.

Angie Lau, 
Founder and Editor-in-Chief