The future of digital asset inheritance

Dubai, UAE, 22 January 2024 - DIFC Innovation Hub, the largest start-up and innovation hub in the world operating out of Dubai International Financial Centre (DIFC), the leading global financial centre in the Middle East, Africa and South Asia (MEASA) region, is collaborating with global Swiss wealth management firm, Julius Baer, and the Financial Market Infrastructure Euroclear, to lead on tackling challenges in the digital asset estate planning space.  

Aligned with the UAE’s vision to help family businesses maximise their contribution to the economy, the collaborative innovation project, organised by DIFC Innovation Hub, will bring together innovators, investors, and subject matter experts from across the wealth management value chain to explore how families can best use technology to manage rapidly expanding portfolios of tokenised and digital assets.

DIFC’s Innovation Hub experts will work closely with Julius Baer’s global innovation team and Euroclear’s innovation centre of excellence for a three-month sprint that will result in a whitepaper detailing a future-oriented solution for succession planning relating tokenisation applied to multi-generational inheritance. The analysis and subsequent findings will serve as a blueprint for other geographies looking to turn similar challenges into opportunities.  

It is estimated that AED 3.67trn (USD 1trn) in assets will be transferred to the next generation in the Middle East over the coming decade. However, only 24 per cent of High-Net-Worth iIndividuals have a full estate plan in place. Fast adoption of various digital asset classes by individuals and businesses also poses potential complexities to a seamless execution of estate plans currently in place. The DIFC Innovation Hub, Julius Baer and Euroclear collaboration will help bring tangible solutions to this global challenge.

Mohammad Alblooshi, Chief Executive Officer, DIFC Innovation Hub, commented: “The region is witnessing a trend of generational wealth being deployed across a variety of digital asset classes to diversify and future-proof their portfolios. By bringing together global leading entities across wealth management, financial services providers, tech disruptors and regulators, this newly launched innovation project will help transform one of the largest, underserved markets in the region and open doors to a more inclusive and tech enabled future for family businesses and the wealth management industry.”

Alireza Valizadeh, CEO, Julius Baer (Middle East) Ltd, said: “Generational wealth transfer is gaining momentum in the UAE, and we, as Julius Baer, are in a unique position to advise our clients having had our origins as a family business. On the occasion of Julius Baer’s 20-year anniversary in Dubai, I am hoping that this innovation project will showcase how we can work together to stay relevant to our future clients and provide a vision highlighting the evolution of the private banking industry especially with the onset of digital assets.”

Philippe Laurensy, Head of Group Strategy, Product Management and Innovation at Euroclear, added: “As a trusted financial market infrastructure we have a strong commitment to collaborate with the market providing innovative solutions to our clients. We are extremely pleased to be working with DIFC Innovation Hub and Julius Baer on what we see as a transformative journey to address market gaps and create efficiencies by harnessing the power of tokenisation. By validating and unlocking the benefits of smart contracts we have the potential to redefine the narrative of wealth management, creating solutions that could span generations.”

Dubai’s strategic location along with DIFC’s position as the region’s most experienced hub for supporting global and regional family-owned businesses, High-Net-Worth (HNW) and Ultra-High-Net-Worth (UHNW) Individuals makes it the ideal testing ground for innovative solutions and POCs tackling the future of inheritance and wealth management. Combined with Swiss Wealth Manager, Julius Baer’s experience in advising UHNW and HNW business families in the wealth transfer process in the Middle East, and Euroclear’s renewed purpose focused on innovation bringing safety, efficiency and connection in the financial market for sustainable economic growth, the innovation project aims to solve challenges faced by individuals when creating inheritance plans to better manage the future.

Euroclear group is the financial industry’s trusted provider of post trade services. Guided by its purpose, Euroclear innovates to bring safety, efficiency and connections to financial markets for sustainable economic growth. Euroclear provides settlement and custody of domestic and cross-border securities for bonds, equities and derivatives, and investment funds. As a proven, resilient capital market infrastructure, Euroclear is committed to delivering risk-mitigation, automation and efficiency at scale for its global client franchise. The Euroclear group comprises Euroclear Bank, the International CSD, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden and Euroclear UK & International.

Dubai International Financial Centre (DIFC) is one of the world’s most advanced financial centres, and the leading financial hub for the Middle East, Africa and South Asia (MEASA), which comprises 72 countries with an approximate population of 3bn and an estimated GDP of USD 8trn.

With a close to 20-year track record of facilitating trade and investment flows across the MEASA region, the Centre connects these fast-growing markets with the economies of Asia, Europe and the Americas through Dubai. 

DIFC is home to an internationally recognised, independent regulator and a proven judicial system with an English common law framework, as well as the region’s largest financial ecosystem of over 39,000 professionals working across over 4,900 active registered companies – making up the largest and most diverse pool of industry talent in the region. 

The Centre’s vision is to drive the future of finance through cutting-edge technology, innovation, and partnerships. Today, it is the global future of finance and innovation hub offering one of the region’s most comprehensive FinTech and venture capital environments, including cost-effective licensing solutions, fit-for-purpose regulation, innovative accelerator programmes, and funding for growth-stage start-ups.  

Comprising a variety of world-renowned retail and dining venues, a dynamic art and culture scene, residential apartments, hotels and public spaces, DIFC continues to be one of Dubai’s most sought-after business and lifestyle destinations. 

For further information, please visit website: difc.ae, or follow us on LinkedIn and Twitter @DIFC.