Technology as a Catalyst for Democratizing Private Markets

Alternative investments—private equity, private credit, real estate, infrastructure and hedge strategies—have historically been the preserve of institutional investors and ultra-high-net-worth individuals. High minimum commitments, opaque fund structures and long lock-ups kept wealth-management clients on the sidelines. Today, technology is breaking down those barriers. Fintech platforms, blockchain-based tokenization, exchange-traded notes (ETNs) and digital marketplaces are enabling fractional ownership, near-instant settlement and global distribution. A 2025 survey of financial advisors found that 92 % currently incorporate alternatives and 91 % plan to increase allocations, while Preqin projects that alternative assets under management could exceed $30 trillion by 2030. This whitepaper examines how technology is democratizing private markets, outlines the benefits and risks for asset and wealth managers, and highlights opportunities in emerging economies.

Introduction: Demand for Private Markets Outstrips Access

Investors are flocking to private markets in search of diversification, yield and inflation protection. Yet traditional fund structures often require minimum commitments of $5 million or more and can lock up capital for a decade. These hurdles have limited participation to a narrow set of investors even as global AUM in alternatives has surged from $4.8 trillion to $22 trillion over the past decade. Latin America illustrates the mismatch between demand and accessibility: allocations to alternatives by Latin American pension funds rose from $46 billion in 2020 to more than $70 billion by 2023, yet most investors still face prohibitive ticket sizes. New technologies promise to close this gap by offering smaller tickets, standardized structures and global connectivity.

Digital Issuance and Exchange-Traded Notes: Securitization with a global ISIN

One of the most impactful innovations has been the exchange-traded note (ETN). An ETN is a debt instrument linked to an investment strategy that can be listed on an exchange and cleared through international depositories. The Q&A document created for LYNK Markets explains that a single global-ISIN ETN allows managers to distribute a strategy across multiple jurisdictions without setting up local funds, centralizing KYC/AML and reducing time-to-market. Traditional feeder funds require separate registrations and ongoing maintenance in each country; separately managed accounts (SMAs) offer customization but lack scalability; private notes have limited distribution and high minimums. By contrast, an ETN provides a standardized, bankruptcy-remote vehicle with transparent collateral and T+2 settlement.

Issuing an ETN through a fintech platform can compress launch timelines from months to weeks. Such platforms maintain template documentation, work with established trustees and custodians and obtain listings on recognized exchanges, enabling managers to focus on investment performance rather than legal logistics. The Q&A notes that ETNs can accept smaller tickets, settle through Euroclear/Clearstream and provide secondary-market-like liquidity, making them especially attractive for cross-border distribution. By securitizing a strategy into an ETN, managers enjoy speed to market, lower costs, scalability and transparent governance.

Fractionalization and tokenized feeders

For asset classes that remain illiquid, tokenization can convert private fund interests into fractional digital tokens. Hamilton Lane’s tokenized feeder fund for its Secondary Fund VI, issued through Securitize, cut the minimum investment from $5 million to $20,000. Token holders receive distributions and capital calls through smart contracts and can trade tokens on regulated secondary markets, improving liquidity. More broadly, the market value of tokenized real-world assets grew from about $10 billion in 2024 to nearly $18 billion by early 2025 and exceeded $24 billion later that year. A Q3 2025 report estimated the tokenized RWA market at $30 billion, with private credit and U.S. treasuries representing the largest segments. These numbers illustrate investor appetite for fractional exposure to private assets.

Digital Marketplaces and Advisor Tools: iCapital Marketplace and SEI Access

Digital marketplaces are emerging as central hubs for alternative products.  iCapital Marketplace connects wealth managers with more than 760 alternative asset managers, issuers and insurance carriers and counts over 115,000 financial professional users. As of 31 August 2025, the platform oversaw $945 billion in assets, including $40.8 billion in international platform assets. Advisors can filter strategies by asset class, region and risk profile, access detailed fund profiles and due-diligence reports, and auto-populate subscription documents directly from digital investor profiles. Real-time dashboards track cash flows and performance, simplifying reporting for both advisors and clients. Such marketplaces reduce information asymmetry and administrative friction, allowing advisors to build customized portfolios with ease.

SEI’s Access platform offers a similar model. Launched in March 2025, SEI Access provides an advisor-centric digital marketplace and education forum. It integrates subscription processing capabilities, combining electronic subscription documents, proprietary paperwork, custodian forms and e-signature tools. For fund managers, SEI Access accelerates subscription-to-funding via paperless processing and simplified workflows and offers distribution opportunities across a wide network of independent wealth managers. This underscores how technology can democratize alternatives by lowering operational burdens and broadening reach.

Centralized onboarding and analytics

Technology also streamlines investor onboarding and compliance. The Q&A document highlights that certain structured products centralize KYC/AML at the issuer level, allowing investors to complete onboarding once and then allocate to multiple underlying strategies without repeating due diligence. Digital platforms can integrate with custodians, validate documents electronically and maintain updated risk profiles. Analytics tools calculate internal rates of return, volatility, drawdown and correlation across portfolios, enabling advisors to compare alternative strategies on a like-for-like basis. This level of data transparency was unimaginable a decade ago and empowers advisors to make evidence-based decisions.

Smart Contracts and Automated Servicing

Smart contracts—self-executing code on a blockchain—enable programmable compliance, capital calls, distributions and redemptions. In tokenized private credit, for example, interest payments are automated and redemption windows can be encoded into the contract, reducing operational workload. The Chartered Alternative Investment Analyst (CAIA) Association notes that tokenization delivers fast and cheap transactions, secondary-market liquidity, fractional ownership and enhanced transparency and operational efficiency. Deloitte reports that blockchain securitizations have reduced loan-level reporting times from 55 days to 30 minutes, demonstrating the potential of automation. When combined with digital marketplaces and centralized onboarding, smart contracts can transform back-office operations and free up resources for client engagement and portfolio construction.

Emerging Markets: New Frontiers for Digital Distribution: Private capital boom in emerging economies

Technological platforms are particularly impactful in emerging markets where access to global funds has been limited. A 2025 mid-year review by LYNK Markets showed that private capital investment in emerging markets jumped 33 % to $72.3 billion, led by India, Southeast Asia and the Middle East. Secondary market volumes exceeded $100 billion, and Latin American hedge funds returned 13.9 %, far outpacing the global composite. At the same time, Latin American pension funds increased alternative allocations from $46 billion in 2020 to $70 billion in 2023. These figures signal both rising demand and a scarcity of accessible vehicles.

Democratizing access through ETNs and tokenization

Fintech ETNs and tokenized feeders can democratize this opportunity. By issuing a global-ISIN ETN, managers avoid country-by-country fund wrappers and centralize KYC/AML, making it easier for Latin American, Asian and Middle Eastern investors to subscribe from their existing custodial accounts. Fractionalization allows high-yielding private credit and real-estate strategies to accept smaller minimums, enabling advisors to build diversified portfolios for clients with limited capital. Tokenized platforms also support multi-currency settlement, letting investors participate without navigating complex currency controls. As emerging markets embrace digital finance—exemplified by Singapore’s Project Guardian and Hong Kong’s Project Ensemble, which involve dozens of institutions testing tokenized finance—global investors will gain more opportunities to tap growth in these regions.

Benefits

Lower barriers to entry: Fractionalization and digital issuance reduce minimum investments from millions to thousands of dollars, broadening participation. Hamilton Lane’s tokenized feeder fund demonstrates that even private-equity strategies can accommodate $20,000 tickets.

Operational efficiency: Platforms like iCapital and SEI Access automate subscription processing, document management and performance reporting. Blockchain reduces settlement times and reporting delays, with securitizations moving from 55 days to 30 minutes.

Transparency and data: Digital marketplaces provide standardized fund profiles, due-diligence reports and analytics. Advisors can compare risk and performance across alternative strategies using objective metrics and incorporate ESG considerations more easily.

Global reach: ETNs with a single ISIN and tokenized feeder funds allow managers to distribute strategies across multiple jurisdictions without forming local vehicles, centralizing KYC/AML and simplifying compliance. Tokenized products can be traded 24/7, facilitating continuous price discovery and liquidity.

Access to emerging-market opportunities: Digital distribution platforms connect investors to private credit, real estate and infrastructure opportunities in emerging economies, where traditional distribution networks may be underdeveloped.

Challenges

Regulatory complexity: Tokenized products and digital platforms must navigate a patchwork of national regulations. The GENIUS Act in the U.S., MiCA in the EU and various sandbox programs in Asia set different requirements for custody, disclosures and reserve management.Managers must ensure compliance across jurisdictions and adapt to evolving standards.

Liquidity and market depth: While tokenized RWAs have grown rapidly, secondary markets remain relatively thin. Investors may face discounts or delays when selling positions. The adoption of tokenized MMFs as collateral could mitigate liquidity risk, but market infrastructure is still developing.

Technological risk: Smart contracts are subject to bugs; digital custody requires secure key management; and cross-chain interoperability remains nascent. Managers and advisors must conduct due diligence on the technology stack and select reputable custodians.

Investor education: Many clients conflate tokenized funds with cryptocurrencies and may be wary of digital assets. Advisors must provide clear explanations about the underlying assets, regulatory protections and redemption terms.

Concentration and systemic risk: A handful of platforms and issuers dominate the digital-asset market. For example, BlackRock controls more than 30 % of tokenized MMFs and Tether holds a 61 % share of stablecoins. Dependence on a few providers could create systemic vulnerabilities.

Opportunities for Asset and Wealth Managers: Expanding product line-ups

Managers can leverage technology to create semi-liquid funds, interval funds and evergreen vehicles that offer periodic liquidity without the cost of daily redemptions. They can package private credit, venture capital or infrastructure strategies into ETNs or tokenized feeders tailored to different investor segments. ESG metrics and impact reporting can be embedded into fund protocols, enhancing alignment with sustainability goals.

Leveraging data and analytics

Digital platforms collect vast amounts of data on investor behaviour, fund performance and risk profiles. Managers can use this data to tailor marketing, improve risk management and optimize portfolio construction. Advisors can use analytics to compare alternatives with traditional assets, examining risk-adjusted returns, drawdowns and correlations to ensure portfolios remain diversified.

Building trust through transparency

Transparency is essential when introducing clients to new structures. Providing verifiable track records, independent audits and detailed disclosures can build confidence. Q&A guidance emphasizes that emerging managers should demonstrate a clear investment process, strong governance, regular reporting and proactive communication to earn advisor trust. Digital platforms can facilitate this by hosting due-diligence materials and performance data in a standardized format.

Harnessing emerging-market growth

Emerging markets offer attractive yields in private credit, real estate and infrastructure due to demographic growth and under-penetrated financial systems. Technology enables global investors to access these opportunities without establishing local vehicles or repeating KYC procedures. Advisors should partner with platforms that have regional expertise and can navigate local regulatory landscapes, enabling them to tap growth while managing risk.

Conclusion

Technology is transforming private markets from exclusive clubs into accessible investment opportunities. Exchange-traded notes and tokenized feeder funds provide standardized, scalable wrappers that lower costs and minimums. Digital marketplaces like iCapital Marketplace and SEI Access aggregate products, streamline onboarding and deliver analytics, empowering advisors to build diversified portfolios. Smart contracts and tokenization enhance operational efficiency, transparency and liquidity. Meanwhile, emerging markets offer new frontiers for growth, and regulatory frameworks like the GENIUS Act and MiCA provide the legal clarity needed for broader adoption. Challenges remain—particularly around regulation, technology and investor education—but the momentum toward democratization is clear. Asset managers and wealth advisors who embrace these tools can expand their client base, innovate product offerings and participate in a future where private markets are open to many rather than the few.

Key Takeaways

Democratization is underway: A majority of financial advisors already use alternatives and plan to increase allocations.; Preqin forecasts that alternatives AUM could exceed $30 trillion by 2030.

Fintech ETNs reduce friction: Global-ISIN ETNs streamline cross-border distribution by centralizing KYC/AML and eliminating the need for local feeders. Tokenized feeder funds can reduce minimums from millions to $20,000.

Digital marketplaces are scaling fast: iCapital Marketplace hosts over 760 alternative asset managers and 115,000 financial professionals and oversees $945 billion in assets. SEI Access offers end-to-end subscription processing and broadens access for wealth managers.

Automation enhances efficiency: Smart contracts reduce reporting times from 55 days to 30 minutes, while digital platforms auto-populate subscription documents and provide real-time dashboards.

Emerging markets represent a new frontier: Private capital investment in emerging economies jumped 33 % to $72.3 billion and secondaries volumes exceeded $100 billion. Technology allows global investors to access these markets through fractionalized, regulated vehicles.

The Evolving Role of Wealth Managers in the Digital Asset Era – Addressing the changing responsibilities of wealth advisors, this paper discusses how to integrate tokenized products, adopt new risk metrics, manage client expectations and leverage digital marketplaces. It offers guidance on centralizing KYC/AML processes, enhancing operational efficiency, and maintaining fiduciary duty amid innovation.