Latest news with #MembersCap
Yahoo
5 days ago
- Business
- Yahoo
Designing a diversified future
Lloyd Wahed, CEO of MembersCap, shares how his firm is expanding access to reinsurance through blockchain tokenisation- offering uncorrelated, yield-generating opportunities to both traditional institutions and the growing digital-native investor base. Unlocking Reinsurance for the Modern Investor "MembersCap was created to expand access to reinsurance as an asset class," says Wahed. Traditionally the domain of large institutional players, reinsurance offers portfolio diversification benefits due to its lack of correlation with broader financial markets. According to Wahed, it's precisely this attribute that has made it increasingly attractive to both traditional private capital and digital-native investors seeking risk-remote, high-yield assets. 'There is an enormous pool of unserved and underserved capital – both traditional private capital and an expanding class of digital-native capital – looking for greater diversification in their portfolios,' Wahed explains. 'We are fundamentally an asset manager delivering on our investment policy, but we have structured ourselves to take advantage of the rapidly converging worlds of TradFi and DeFi to create access for this new class of investor.' The Mechanics and Merits of Tokenisation At the heart of MembersCap's strategy lies blockchain technology. But for Wahed, tokenisation is not about hype, it's about infrastructure. 'Tokenising any fund, reinsurance or otherwise, really refers to creating a blockchain-based ledger, or book-of-record of ownership of the fund units and the fund,' he says. 'Each tokenised fund unit is anchored to this ledger through a smart contract, which carries the data of the fund itself, and the ownership credentials of the unit owner.' This infrastructure allows near-instantaneous trading, settlement, and redemption, while enabling automated pricing, reporting, and execution of corporate actions. For institutional investors, tokenisation translates into faster reporting, more efficient compliance monitoring, and reduced operational friction. 'Tokenisation makes investing in reinsurance simpler and more accessible, even for institutions,' Wahed adds. From Lloyd's to the Blockchain MembersCap has structured trades to cover exposures like natural catastrophes and cyber risk. The firm works closely with Lloyd's of London syndicates and top-tier reinsurance brokers to execute these deals. In an industry where trust and long-term relationships still dominate, MembersCap's differentiated capital base provides a new kind of reliability. 'Reinsurance is an industry that is built on the concept of trust,' Wahed says. 'These relationships are fundamental to our ability to access trades that not only deliver positive outcomes to our investors but also align with the syndicates and other partners' long-term risk transfer strategies.' Scaling Up: Roadmap and Strategy Looking ahead, MembersCap's strategy revolves around scaling beyond its flagship vehicle, MCM Fund I. While this fund acts as a stable entry point into reinsurance for institutional capital, the future lies in expanding access to wealth managers, DeFi institutions, and digital-native capital pools. 'These investors are looking for capital protection, low duration, and high yield,' Wahed explains. 'Traditional institutions can be accessed through actuarial intermediaries, but DeFi balance sheets are relying on a new array of advisors, digital private banks, and related service providers to help manage their treasuries.' To meet this need, MembersCap is building an ecosystem of financial institutions, technology partners, and distribution platforms that can handle the specific structural, custodial, and jurisdictional needs of each client segment. 'Our goal is to increase access to reinsurance as an investment in general and continue to build on our leadership role in bringing its attributes to digital finance.' Educating a New Class of Investor Reinsurance and blockchain might seem worlds apart, but MembersCap is intent on closing that gap through education and digital enablement. 'MembersCap has developed a thought-leadership role in the digital asset world, specifically with respect to the tokenisation of alternative classes of securities,' says Wahed. This means having a deep command of the regulatory, compliance, and operational nuances of digital asset securities and educating both intermediaries and end-clients through conferences and joint meetings. 'Digital onboarding is enabling automation of a very time-consuming process,' Wahed adds, citing improvements in AML/KYC as a key enabler of smoother client experiences. Chasing the $10tn Opportunity With the global insurance protection gap estimated at $10tn, MembersCap is targeting geographies where both reinsurance and digital assets already have strong foundations. 'We are finding a concentration of opportunities with investors in Switzerland and the United Kingdom,' Wahed notes, 'but clearly, our longer-term growth opportunities are in Asia, the Middle East, and the USA.' He points out that jurisdictions like Bermuda, London, and Zurich/Zug have become hubs for both reinsurance and tokenised finance, a convergence that MembersCap is uniquely positioned to capitalise on. Tokenisation: Future Infrastructure, Present Access While the benefits of tokenisation such as increased liquidity, cost reduction, and secondary market access may take time to fully materialise, Wahed sees today's most compelling advantage in democratising access. 'In our view, the most important element of tokenisation as of today is unlocking access for the growing class of investors who would not otherwise be able to get exposure to reinsurance,' he says. That includes smaller institutions and DeFi-native players who are seeking scalable yield strategies without correlation to equities, bonds, or crypto. Looking ahead five years, Wahed expects tokenisation to become a cornerstone of the asset management industry. 'There is huge movement in the direction of tokenisation and blockchain infrastructure at the largest financial institutions and global financial intermediaries,' he says. 'We believe there is a generational shift occurring amongst investors that demand more access, more transparency and more optionality.' Wahed's Cross-Disciplinary Approach Wahed's journey across executive search, fintech, and blockchain gives him a unique vantage point for building a company like MembersCap. 'This is an undertaking that requires having a fundamental understanding of three completely different stakeholders: the reinsurance world, the traditional asset management world, and the crypto world,' he says. He credits this multidisciplinary background and his co-founder Patrick Barrett's complementary experience for helping the team navigate what they jokingly call the 'Bermuda Triangle' of global finance. Through his previous work at Mana Group and his podcast Searching for Mana, Wahed gained valuable insights into founders and financial innovators. 'You start to see who's building with real intent versus who's chasing narrative,' he says. 'And you learn that long-term value creation looks fairly consistent, regardless of the sector.' TradFi vs. Crypto: Misunderstandings and Merging Paths Wahed believes there are still blind spots between the traditional and crypto-native financial worlds. 'TradFi probably underestimates how fast the crypto-native world can build and iterate,' he says, 'And crypto often underestimates how much trust, governance, and process matter at scale.' With MembersCap, he aims to take the best from both: 'credible, regulated risk with more efficient and more widely accessible infrastructure.' The Bigger Picture: Reinsurance in the Modern Portfolio As institutional capital floods into digital assets, reinsurance-linked products could offer a valuable diversification tool in next-gen portfolios. 'Both of these things are linked to a larger trend, which is toward greater access to a greater number of asset classes,' says Wahed. 'Perhaps especially reinsurance because it is such a wonderful natural portfolio diversifier.' He adds, 'I want my daughter to grow up being able to manage a diversified personal portfolio that moves beyond a simple 60/40, but which doesn't require a $100m check to get access.' Macro Uncertainty, Micro Precision With macroeconomic turbulence from inflation to geopolitical risks roiling global markets, uncorrelated assets like reinsurance have become more attractive than ever. 'In this environment, we would expect investors to seek shelter in assets with lower or no correlation to broader macro trends,' Wahed concludes. 'Fundamentally, uncorrelated assets like reinsurance definitely become increasingly attractive, and so our mission is to provide investors that access.' "Designing a diversified future" was originally created and published by Private Banker International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
FF News
04-07-2025
- Business
- FF News
Members Capital Management Completes Initial Deployment of Tokenised Reinsurance Fund
Members Capital Management ('MembersCap'), a Bermuda-regulated investment manager, today completed the successful investment of its initial portfolio through its fund, MCM Fund I, the first tokenised institutional-grade reinsurance fund designed for both sophisticated digital asset investors and traditional allocators. All portfolio trades were executed with global reinsurance companies and top-tier Lloyd's of London syndicates, and were sourced through the top three global reinsurance brokers. MCM Fund I opens access to reinsurance income for a rapidly expanding capital base of new investors seeking diversified and uncorrelated investment alternatives with attractive yield and structured liquidity. The launch represents the growing importance of funds structuring their offerings to take advantage of the continuing convergence between traditional finance and digital assets. Backed by Solana, Aptos, and Cardano and supported by institutions like Coinbase, Archax, Apex Group, and Envelop Risk, MembersCap has selected the Solana, Aptos, Cardano, and Base protocols to provide access to qualified investors wishing to invest using eligible cryptocurrencies. MembersCap has been selected as the first fund in the real-world assets category on the Archax platform, sitting alongside tokenized offerings from other institutions like BlackRock, State Street, and Aberdeen. The reinsurance opportunity Being fundamentally uncorrelated with the financial markets, reinsurance has consistently outperformed most traditional alternatives over the past two decades. Despite being highly yield-generative, the sector has historically been reserved for pension plans, sovereign wealth funds, and other institutional giants. Increasingly, both crypto-native investors and smaller traditional allocators are seeking refuge from market volatility by accessing reinsurance as a stable, diversified income stream to support a balanced portfolio and enhance overall returns. 'Every generation is presented with new technologies that unlock economic opportunity. To us, tokenisation and the blockchain represent access to better asset management for a different class of investor,' said Lloyd Wahed, Co-Founder and CEO of MembersCap. 'We're excited to be one of the first institutional funds to emerge from this space.' 'Our investors– digital asset institutions, family offices, HNWIs —want to meet their goals of resiliency and long-term sustainable growth through new and more efficient means. With this novel approach, we're seeing these investors view reinsurance as a core part of their portfolio for the first time,' said Patrick Barrett, Co-Founder and COO at MembersCap . 'This launch proves that tokenisation can bring new capital to help address the growing insurance protection gap by lowering barriers and providing access to the private reinsurance market,' said Dr. Benjamin Fox, Co-Founder and Chief Investment Officer at MembersCap. 'Our tokenised model enables a new cohort of investors to participate pari passu alongside large institutions in an uncorrelated asset class with a track record of reliable, attractive returns.' Positioned as an alternative to private equity, venture capital, and fixed income strategies, MCM Fund I provides qualified investors with regulated and collateralised access to reinsurance via direct exposure to natural catastrophe and cyber reinsurance contracts sourced through blue-chip global partners. For Web3 treasuries, foundations, and institutions, the Fund delivers high-yield opportunities and structured liquidity, derived from high-quality, real-world reinsurance returns, without exposure to DeFi volatility and over-concentration in altcoins. MembersCap was founded in 2024 and is backed by a strong coalition of both institutional and blockchain-native partners. This blend of traditional underwriting expertise and on-chain architecture ensures institutional-grade standards while embracing next-generation accessibility.
