The Depository Trust & Clearing Corporation and iCapital have formed a strategic collaboration to improve infrastructure supporting private market investments, with DTCC also making a strategic investment in iCapital.
The partnership combines DTCC’s market infrastructure, processing capabilities and financial-services network with iCapital’s technology and alternative-investment workflows.
The companies plan to connect data, operations and market participants across the private investment lifecycle in an effort to reduce operational friction and allow wealth advisers and asset managers to participate in private markets more efficiently.
One initial initiative will further integrate DTCC’s Alternative Investment Product with iCapital’s alternative investment platform.
The companies plan to connect transaction processing, data exchange, access, administration and reporting across the two systems.
DTCC and iCapital also intend to evaluate technologies including blockchain-enabled distributed ledger technology and tokenization where appropriate.
The collaboration comes as private assets become a larger component of individual and institutional investment portfolios, increasing demand for greater standardization across transaction and operating processes.
As part of DTCC’s investment, Talia Klein, Head of Wealth & Investment Solutions at DTCC, will become an observer on iCapital’s Board of Directors.
iCapital services approximately $1.2 trillion in assets globally across its platform, including $327 billion in alternative platform assets, $311 billion in structured investments and annuities and insurance outstanding, and $563 billion in client assets reported on.
Its platform serves nearly 3,900 wealth management firms and 144,000 active financial professionals.
KEY QUOTES:
“Private markets represent one of the most significant growth areas in financial services today, creating an urgent need for modern, scalable infrastructure. Our strategic partnership with iCapital reflects DTCC’s commitment to supporting the continued evolution of diverse financial markets. Broader adoption of alternative investments will depend on making the ecosystem easier to navigate, more efficient to operate, and highly resilient.”
Frank La Salla, President, Chief Executive Officer and Director of DTCC
“Together, iCapital and DTCC are advancing the infrastructure and standards shaping the future of private markets. Our shared vision is a more connected ecosystem that expands access and makes alternative investments easier and more efficient to transact and manage. We will partner on technologies that support the overall goals of the relationship, such as blockchain-enabled DLT and tokenization, where appropriate, that help build a stronger foundation for the industry’s continued evolution.
With this investment, DTCC joins a diversified group of strategic investors who share our conviction that the future of private markets will be underpinned by infrastructure that is more connected, standardized, and scalable.”
Lawrence Calcano, Chairman and Chief Executive Officer of iCapital
“We’re seeing increased demand for private assets as a component of investor portfolios, creating a growing need for accessible, scalable infrastructure. Private markets have traditionally lacked the operational standards that exist in public markets. With this collaboration, we look forward to working alongside the iCapital team to improve connectivity, streamline processes, and support continued growth responsibly.”
Talia Klein, Head of Wealth & Investment Solutions at DTCC