Fidelity International’s chief executive has said it is “thinking about” non-fungible tokens (NFTs) and that the metaverse “could be very transformative” for the wider asset management
NFT in Fidelity’s five year plan
Dame Anne Richards, Fidelity CEO said while Speaking at City Week 2022 last week (April 27), that over the next three to five years. Fidelity will be looking at how it can make intangible assets – such as NFTs – more tangible and build portfolios around them. She also added that they are opening up a much wider scope of things that users can invest in.
“How can we take advantage of technology which allows us to make really illiquid stuff more liquid? For example, through tokenisation of big real assets. And how can we build portfolios around them for things which take intangible assets and make them more tangible? NFTs is an example of that, but there are others.”
Richards also believes that from an investment point of view. They will open up “a much broader range of things that can be made investable.” And these plans are some of the things Fidelity is thinking about. And the journeys that they are on over the next three to five years.
NFTs A growing trend
An NFT is a digital artwork that uses blockchain technology to prove ownership. Last year, about $41bn spent on NFTs. Which highlights the potential of the crypto derivative
The NFT trend became popularised in March, when artist Beeple sold a collage for $69.3mn at Christie’s. But the new, unregulated NFT market is fraught with its own risks.
Blockchain data analytics firm Nansen notes that there was about $2mn of activity related to the CryptoPunk and Bored Ape NFT collections.
Fidelity to make NFTs more Tangible to investors
At City Week, Richards not only pointed out the work Fidelity was doing to make NFTs more tangible for investors. She also pointed to the “transformative” benefits of the metaverse.
JPMorgan, which recently launched into the metaverse defines it as a “seamless convergence of our physical and digital lives”.
A study by Gartner revealed that by 2026, 30% of organisations are expected to have products and services ready for metaverse.
Richards believes that the hyper-individualization of advice, guidance, and nudging clients toward financial decisions is transformative. But, she believes it is difficult for firms. And this is evident until consumers need to make important decisions.