Historically, private markets were reserved for institutional investors due to high minimums and limited liquidity. Several innovations are changing this landscape:
- Tokenization: converting ownership rights into digital tokens allows fractional ownership and programmable liquidity. By March 2025 the market for tokenized real-world assets had grown to about $17.9 billion with major asset managers launching tokenized funds.
- Fractionalization through ETNs and interval funds: packaging illiquid strategies into smaller tradable units makes them accessible to wealth clients.
- Digital marketplaces: online platforms aggregate alternative products, standardize due diligence and enable direct subscriptions from advisors.
- Centralized KYC/AML: onboarding investors once for multiple products reduces friction and cost.
These developments lower barriers to entry and provide advisors with tools to offer institutional-grade strategies to a wider range of clients.