Julius Baer, DIFC, Euroclear to launch digital asset inheritance solution

Three firms are exploring solutions for digital asset inheritance in an attempt to solve the challenges associated with bequeathing assets to estates.

Swiss-based private bank Julius Baer (NASDAQ: JBAXY), Euroclear, and the Dubai International Financial Centre (DIFC) have teamed up to launch a digital asset estate planning offering in the coming months. The offering is expected to provide a seamless system for asset holders to pass their private keys to their dependents upon their demise.

The solution will rely on smart contracts to support the transfer of wealth from one generation to another to “redefine the narrative of wealth management.”

Without proper inheritance solutions, millions of digital assets are at dire risk of loss in the event of the demise of private key holders. The partnership expects $1 trillion in assets to be transferred in the coming decade, with digital assets expected to make up a significant portion of the lot.

The proposed digital asset inheritance solution appears tailor-made for high-net-worth individuals, but there is speculation that it could be expanded to all classes of individuals.

While the announcement failed to share technical details for the offering, Julius Baer and Euroclear experts will embark on a “three-month sprint” to explore the solution in depth. At the end of the study, the trio will publish a white paper detailing the findings of the experiments, which it says will serve as a guide to other regions looking to explore tokenization and multi-generational inheritance.

“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 and the wealth management industry,” said Mohammad Alblooshi, CEO of DIFC Innovation Hub.

Parties to the joint venture have garnered considerable experience in Web3, with Julius Baer offering digital asset solutions to clients in 2019. On the other hand, post-trade service provider Euroclear is testing the waters with the launch of its Digital Financial Market Infrastructure (D-FMI).

DIFC doubles down on blockchain

The DIFC is doubling down on utilizing blockchain, hosting several firms exploring the emerging technology.

In mid-2023, the DIFC unveiled a new licensing regime to support artificial intelligence (AI) and Web3 firms, hinging on a 90% subsidy on fees and establishing a campus to incubate early-stage startups.

“We are confident that by granting these licenses, we will attract more global talent and investment to the region and create a culture of collaboration and innovation,” said Alblooshi.

The DIFC has since struck high-profile collaborations to roll out a blockchain-based data-sharing platform and a Know Your Customer (KYC) tool for financial service providers.

Watch: It’s time for corporates to turn to public blockchain solutions