The wealth and investment landscape has seen its fair share of changes over the last few years. While that happened, technology has emerged as the best bet to a better future. As the ecosystem matures, it presented opportunities and concerns in areas like DeFi and digital assets.
The Wealth Today Summit held on June 21, 2022, at the Address Dubai Mall Hotel, looked into emerging trends and factors that that affect the investment ecosystem, especially in the UAE. The Wealth Today Summit is an industry-driven event attended by over 200 professionals from the wealth and investment industry.
The digital assets adoption, the way forward in institutional capital were some of the topics discussed at The Wealth Today Summit. The experts who spoke at the forum were a mix of industry leaders and regulatory authorities, including Wai-Lum Kwok, CFA, Senior Executive Director, Authorisation & Fintech, FSRA, ADGM; Benjamin Ampen, Managing Director MENA, Kraken Crypto Exchange; Dr. Ryan Lemand, Co-Founder & CEO, Neovision Wealth Management and Gaurav Dubey, CEO, TDeFi – Crypto Incubator and Advisory, among others. Topics covered various aspects of the digital asset spectrum such as DeFi for family offices, Tokenization of funds and virtual assets, investing alternative investments and hedge funds, Family offices navigating the Venture Capital space and Investing in offshore jurisdictions: themes and considerations.
“The number of people who attended The Wealth Today Summit reflects the current state of the market. At the event, we reflected upon why the traditional world should start considering digital assets as a part of their asset portfolio,” states Gaurav Dubey, CEO, TDeFi – Crypto Incubator and Advisory. He adds, “The last three years have been pivotal in mass adoption and acceptance of crypto as an asset class in average household. Factors such as tokenization of regulated securities like gold, carbon credits and even trees played a huge role in making this happen. Today, crypto has found its peg in the traditional finance market. We see that the cypto market is performing better than traditional assets currently. As a high-risk asset, crypto cannot form a majority of the asset portfolio but it has found its place in the wealth preservation funds.”
Everyone at the event agrees that the UAE is largely being recognized as a digital assets and digital hub globally. The UAE authorities have been aggressive in the digital asset space. Setting up a regulatory ecosystem with VARA, DMCC, ADGM and DWTC encourages players to license and authorize crypto assets, increases confidence among investors to trust regulated companies. The regulatory acceptance is a big influencer for the mass adoption of digital assets in the region.
DeFi and crypto assets are finding their way into family office portfolios and they become part of the diversification play. Dr. Ryan Lemand, Co-Founder & CEO, Neovision Wealth Management, comments, “Family offices, particularly in this region invested heavily in equities and real estate. Real estate takes a big portion of investment portfolio. However, it is tedious to register or exchange your property in the traditional manner. Besides, with the peak we observe in both these segments, it makes sense for family offices to consider alternative investments in the coming periods. At the sessions, we introduced DeFi to more traditional investors rather than specialized investors. With DeFi, a smart contract adds convenience and makes it accessible to investors.”
Benjamin Ampen, Managing Director MENA, Kraken Crypto Exchange, adds, “DeFi is in a very interesting space, and still in its infancy. It can address issues like inefficiency, opacity, lack of interoperability and centralized control. It comes with an attractive promise of removing intermediaries.”
Going forward, regulations will play a key part. ADGM’s Financial Services Regulatory Authority (FSRA) is at the forefront of issuing regulatory frameworks around DeFi. Wai-Lum Kwok, CFA, Senior Executive Director, Authorisation & Fintech, FSRA, ADGM reveals, “We released a whitepaper with reference points to encourage dialogue with the community. It is based on four concepts; DeFi does not change the nature of financial services; Equivalent risk, equivalent rules; No anonymous participants; and governance of defi protocols.”
During the panel “Family Offices Navigating the venture capital space: finding the right chemistry” moderated by Bhaskar Dasgupta, key speaker Arshad Khan highlighted that UAE becomes now the go-to hub for family offices to set up shop. Panelists added to the discussion that it is essential for family offices to take into consideration the digital assets approach and look at the ecosystem as a whole.
Breaking the myth about Bitcoins, Saqr Ereiqat, Co-Founder, Crypto Oasis, addressed, “There’s a big argument about the energy efficiency of Bitcoins. Bitcoin mining uses less than 1 per cent of global energy consumption for a multi-million-dollar economy. This created an entire new economy and that’s not bad. Moreover, 50 per cent of bitcoins are being mined by green energy.”
The Wealth Today Summit was sponsored by TDeFi, fasTToken, 21Shares, Kraken, Stockal, FRA, and Peregrine; with support from Crypto Oasis.
The Wealth Today is a vehicle of communication for professionals and organizations shaping the finance, wealth, banking, investment, trade, and business landscape.