Tokenisation: a better way to own what you own
episode
Short Briefings on Long Term Thinking - Baillie Gifford
31 min
2 speakers
8 chapters
transcribed 1 month ago
Transcript
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Transcript generated automatically by AI and may contain errors.
What is tokenisation and why does it matter for investors?
Mm-hmm.
In the late 1960s, the New York Stock Exchange and other US markets cut their trading hours and began closing every Wednesday. It was an act of desperation caused by a flood of paperwork. Trading volumes had soared, and brokers were resorting to couriers, often retired police officers and firemen, to ferry suitcases of share certificates between offices. Many went missing. In nineteen seventy three, the industry created the Depository Trust Company to fix this. It kept hold of the certificates and tracked ownership electronically. It worked, but ever since the industry's been burdened by middlemen and duplicate ledgers. О тоді технології brings an alternative. Blockchain based tokenization.
It streamlines the system and enables new possibilities such as 24-7 trading. And Bailey Gifford is among the first active managers to adopt it. Welcome to Short Briefings on Long Term Thinking. I'm Leo Kellyan and I'm joined by Theo Golden, Bailey Gifford's Head of Digital Assets. Before we explain all, a quick reminder. As with all investments, your capital's at risk and your income is not guaranteed. Theo, welcome to the show. Thanks for having me. So Theo, that history explains how the industry dealt with a paperwork problem by adding layers. So is tokenization best thought of as stripping those layers back out to reduce friction?
That is is essentially at its core what what we're talking about. This is a rewiring of the financial system. It's about creating a world with less friction, greater utility, and simply better access for folks across the globe looking to access the world of savings and investments.
So Theo, I'm gonna get you to do a lot of explaining on this podcast. But before you do, I just want to explore how you came to head up our tokenization efforts. And I believe the initiative's got its roots in your family history. So can you tell us a bit about that?
Of course, I guess my interest in digital assets stems from a I gu a very personal experience. A lot of people get into digital assets and crypto for I guess speculation to an extent. But my mine has always been rooted in use cases.
How does tokenisation create a “world with less friction” for buying and selling assets?
My family history is one of slight disruption in terms of my mother's family fled Libya, fled Colonel Gaddafi and were forced to go to Italy and then in London. And my father's family during the war in the Second World War had to flee Thessaloniki in Greece after the Nazi invasion. And so on both sides of my family there's this trauma of having lost everything, your livelihoods and having to essentially start again. And there was a very, I guess, personal moment when I was around fourteen, fifteen. My grandmother on my my mother's side was towards the end of her life and she turned around to me and she said, There's something along the lines of, Don't make the same mistake that we did. Make sure that you always have a backup.
make sure you've got two hundred dollars, three hundred dollars stash under the bed. So if things go sideways, if not when, but if, that you have a backup. And now it's quite a a strong thing for a fourteen year old Theo to have heard. And also I guess a reflection that it's quite hard to smuggle two hundred dollars past your parents and smuggle it under the bed. But luckily for me, I was a chronically online teen and I was in the world of Discord and Reddits and and w and whatnot. But had found out about this thing called Bitcoin. And this idea that there was this asset which was decentralized in that no one person owned it. There was no central issuer. There was this asset which could be self-sovereign.
I could own it and it could be mine, truly mine. I could custody it myself and not be reliant on any counterparties. And that asset could come with me wherever I had to go. And so I bought some Bitcoin. I bought some Bitcoin at fifteen with one of my very first paychecks. And I cannot uh claim to be some sort of inspired young investor where I knew it was going to go up or actually probably thought it was gonna go down. But the one thing I knew was that it it was a backup.
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Chapters
8 chapters
1
What is tokenisation and why does it matter for investors?
0:03–2:26
2
How does tokenisation create a “world with less friction” for buying and selling assets?
2:26–4:49
3
Why did Theo’s personal history shape his view of digital assets and tokenisation?
4:49–6:38
4
What is a blockchain‑based token and how does it become a shared source of truth?
6:38–8:56
5
How does tokenisation make assets more useful – e.g., as collateral or “Lego bricks”?
8:56–11:32
6
What are the practical benefits for clients – lower cost, 24/7 trading, and better access?
11:32–13:17
7
How are risks like hacks, lost wallets, and regulatory concerns managed in tokenised funds?
13:17–15:57
8
What’s the roadmap for expanding tokenisation beyond fixed income to the whole investment universe?
15:57–31:51