Vincent Clause, global head of fund strategy and product development at Euroclear Group (Euroclear), explained the strategic rationale behind the group’s investment in Marketnode, highlighting its broader vision and activity, as a global financial market infrastructure with over $42.6 trillion (EUR 40 trillion) in assets under custody and a presence in all parts of the world. He said Asia is a key area of growth for Euroclear, both from a strategic and shareholder perspective. “We are not any longer in a mindset where everything needs to be developed on our own. The partnership component is key in our expansion,” Clause said. Clause explained that in a market as attractive as Singapore, it was important for Euroclear to bring its global perspective and combine it with local know-how, particularly in the digital space. He noted that funds are one of the fastest growing asset classes with a 12% uptick on the previous year, forecasted to represent $145 trillion globally by the end of 2025. “The fund industry is already quite established with attractive growth in both public funds, such as exchange traded funds (ETFs) and private markets, which is where we see massive growth potential.” Rehan Ahmed, CEO of Marketnode, pointed to three important facts, “There are $5.4 trillion of assets booked in Singapore. There are about 1,300 registered fund managers. And over the next five to 10 years, we expect seven million new millionaires to emerge in the ASEAN region.” He emphasised that Singapore is already a centre of gravity for both wealth and demographic growth. He explained that Marketnode was created from the beginning to support this opportunity, “Since inception, we have always thought about how we build the infrastructure to enable this—specifically in fund formats.” Ahmed said that very early in Marketnode’s journey, the team recognised that success would require a partner with the global scale and operational strength of a financial market infrastructure like Euroclear. Complementary roles: global reach meets digital agility Clause said that the partnership with Marketnode was based on exploring complementarities, “It’s growing together in Singapore, and it’s also about bringing a new kind of investor access.” He emphasised that FundsPlace would be the gateway to global funds, while Marketnode would be the gateway to a new investor profile, including digital-first platforms and non-traditional channels. Ahmed noted that Marketnode complements Euroclear by bringing agility and access to newer client segments. “We have been working with Euroclear essentially since day one of our journey,” he said. “They bring operational expertise, scale and network, while we bring in the ability to leverage new technology like artificial intelligence (AI) and distributed ledger technology (DLT) to create a global infrastructure.” Clause observed that customer expectations are shifting. “We are no longer only serving large institutional clients,” he said. “Retail and high-net-worth investors are now demanding access to funds and often through new platforms. That is why partners like Marketnode are essential.” Standardisation and digital enablement Ahmed stressed the importance of standards in enabling the solution to work. “What makes this possible is standards,” he said. “Euroclear and other financial market infrastructures are good at unifying markets through standards. At Marketnode, we try not to reinvent the wheel—we take what works globally and apply new technology to reduce settlement times, improve recordkeeping and convert unstructured data to structured formats.” Clause confirmed this approach, “Our DNA is to build infrastructure that works efficiently at scale, but we also have to evolve with the market. Technology allows us to serve new types of clients and investors. That is why this partnership is key—we maintain standards but also introduce flexibility where needed.” Solving fund market inefficiencies Ahmed explained the practical use case for the solution, “Investors do not think about messaging infrastructure or fund structures. They think about getting access to the right fund without having to wait five days for delivery.” He said that the integration between FundsPlace and Fundnode creates a single order platform that allows execution across domestic public, private and eventually tokenised funds. “Think of us as the pipes that bring both domestic and offshore funds together,” Ahmed said. He noted that even today, despite automation, faxes and paper-based processes still persist. “Sometimes it is not blockchain that solves the settlement problem, it is just basic digitisation,” he said. He added that Marketnode’s approach includes bundling orders to lower per-unit costs, enabling future tokenisation and data analytics layers. “It is a holistic view. We’re not solving just for one thing.” Clause added that the work being done is just the start of the connectivity between FundsPlace and Fundnode. “We do not do tokenisation for the sake of it. We build solutions that deliver tangible benefit to the industry,” he said. Scalable infrastructure for retail and institutional flows Ahmed noted that both firms are business-to-business oriented, but the infrastructure has to scale to meet retail demand. “Even if we do not serve three million retail clients directly, we have to design the system to handle that many wallets,” he said. “And it has to be resilient, cyber-secure and scalable.” He said Marketnode had to take a fundamentally different approach to building infrastructure that anticipates this scale. “We have already planned for scenarios like scaling from three to eight million accounts,” he said. The team focused heavily on cybersecurity, record-keeping and penetration testing. “Two months ago, we received ISO 27001 certification, which validates the controls we put in place,” he added. A pragmatic approach to distributed ledger technology Ahmed clarified that Marketnode’s infrastructure is “DLT-enabled but not DLT-exclusive.” He explained that not all clients are ready to adopt blockchain-based systems and that Marketnode offers multiple integration points through application programming interfaces (APIs) and file transfers. “We do not force a technical choice on clients,” Ahmed said. “Otherwise, you get a cold-start problem, which many DLT projects in the industry have faced.” Clause agreed, “We still believe in the traditional way of processing funds, and that remains 99.9% of our business. But we also see growing client demand for tokenised funds, and we need to support that.” He added, “It is not about forcing tokenisation. It is about responding to client needs. The infrastructure must be flexible enough to support traditional, tokenised and hybrid models.” From Singapore to Asia, the Middle East and beyond Ahmed said the current focus is on executing well in Singapore, particularly with new structures such as Variable Capital Companies (VCCs). He noted that Marketnode launched its first VCC fund on the platform in April. Ahmed also mentioned an ongoing public consultation in Singapore on long-term investment funds that aim to make private funds accessible to retail and high-net-worth individuals. “That is a journey we want to be part of—providing the infrastructure to support that access,” he said. Clause described Singapore as an ideal starting point, “It is sizable, concentrated and internationally exposed. If this model works in Singapore, it will be easier to scale it to other countries because many of the same players will adopt it.” Looking beyond Asia, Clause noted the relevance of the Middle East, where there is fresh capital and limited legacy infrastructure. “There is growing collaboration between Asia and the Middle East,” he said. “These are new corridors for fund flows.” Business model, volume goals and commercial targets Ahmed shared Marketnode’s growth journey from its founding by SGX and Temasek in 2021 to its Series A round in 2024 with HSBC and Euroclear. “We process about 120,000 to 150,000 fund orders per month on Fundnode. We want to scale that to one to 1.5 million,” he said. He added that this is a typical startup journey—product-market fit, strategic partnerships, volume scale-up and monetisation. “Once we hit the volume inflection point, monetisation follows,” he said. He also noted the long-term expansion into other asset classes, “Private funds are a natural next step, but by 2026, we could also be looking at credit and loans.” Clause emphasised that Euroclear’s investment is focused on sustainable value, “We are in this for the long term. We only invest where we see a real market need.” Convergence as a blueprint for the future Ahmed said this partnership is a model others might follow, “We have maintained our regional roots but recognised that to scale, we need a global partner. This is a blueprint for regional and global convergence.” Clause added that Euroclear is not stopping at this collaboration. “We have also acquired Goji, which focuses on capital call management and onboarding. And we work with Microsoft to enhance our capabilities in data and artificial intelligence,” he said. Data as a bridge to automation and adoption Clause said the only reason to build infrastructure is to solve a real problem, “The cost of fund processing remains too high. This has to be a business case that creates value.” Ahmed explained Marketnode’s approach to data, “You might execute a fund order on a slick app, but what happens behind the scenes is still manual and paper-based. We use open-source language models to extract data from forms like faxes, convert them to machine-readable formats, and plug them into our ledger.” He explained that their strategy was about solving the cold-start problem, “How do you get transactions onto your platform? That is our challenge.” He contrasted that with Euroclear’s focus on managing data already in custody. “One is about getting the data in. One is about what you do with it after. It is very complementary.” Preparing for the next generation of fund investors Clause concluded that tokenised funds will inevitably grow as investor behaviour changes. “There is a lot of speculation about how big it will get—10 % or 20% —but it won’t stay at 0.1%. The next generation of investors in Asia will expect tokenised access.” Ahmed agreed, saying, “This is not about DLT or Singapore. It is about building a better infrastructure model that combines the best of traditional and digital. That’s how we prepare for what is next.”
