On the Avalanche blockchain, digital asset company Securitize Capital is going to tokenize KKR’s $491 billion Health Care Strategic Growth Fund II (HCSG II).
The news was announced by KKR on September 13. The head of Securitize Capital, Wilfred Daye, called the tokenization of HCSG II a “significant breakthrough” for people to get access to private equity markets.
With tokenization, investors can own a token that represents a share of the $4 billion healthcare-focused fund that invests in 23 North American and European companies in the pharmaceuticals, medical devices, and life sciences sectors.
Related: Sources say that the head of KKR Greater China is leaving to become an adviser.
Investors need to show their passport, fill out personal and tax information, and do a “liveness check” before they can buy into the HCSG II Fund on the Securitize Protocol. Investors also have to pay a management fee of 0.50%.
Emin Gün Sirer, founder and CEO of Ava Labs, said that the tokenization of the HCSG II Fund was a “huge milestone” for the blockchain industry because it made it possible for “real world assets” to move on-chain:
KKR said that on-chain tokenization of real-world assets also “lowers investment minimums, improves digital investor onboarding and compliance protocols, and increases the possibility of liquidity through a regulated alternative trading system.”
Tokenization: What It Is and How It Works
Boston Consultant Group (BCG) and Raiffeisen Bank International’s Blockchain Research Hub both agree that tokenization has the potential to take over a big chunk of the world’s assets.
BCG said that by 2030, $16.1 trillion of assets that are hard to sell will be turned into tokens. Last year, the Blockchain Research Hub at Raiffeisen Bank International said that by 2030, most securities will be turned into tokens.
Related: In a round led by KKR, cybersecurity company Semperis raised more than $200 million.
Securitize Capital runs the Securitize Protocol, which was added to the Avalanche Blockchain in December 2020. Its goal is to “reinvent private capital markets by providing trusted end-to-end security token solutions.”
