Members Capital lists its first tokenised ILS fund on Archax digital asset exchange

Members Capital Management Limited (MembersCap), the Bermuda-regulated investment manager, launched its first tokenised insurance-linked securities (ILS) fund, MCM Fund I on the Archax digital asset exchange, marking a notable milestone in bridging institutional reinsurance and blockchain-based finance.

Earlier this month, MCM Fund I successfully completed the investment of its initial portfolio.

The trades were executed with leading global reinsurers and major Lloyd’s of London syndicates, sourced through the top three global reinsurance brokers.

As we explained in our previous article, MCM Fund I represents a pioneering approach to reinsurance investing, leveraging blockchain technology to reduce entry barriers, and making a traditionally exclusive, high-yield asset class accessible to a broader range of investors, including digital asset allocators.

“Reinsurance – ‘insurance for insurance companies’ – is fundamentally uncorrelated with the broader financial markets and as an asset class has consistently outperformed most traditional alternatives over the past two decades. Despite these attractive qualities, high barriers to entry have meant the sector has largely remained the preserve of pension plans, sovereign wealth funds, and other large institutional investors,” MembersCap said.

Working together with Archax, MembersCap states that it aims to expand this access by harnessing blockchain technology to lower these barriers and offer unique opportunities to investors seeking stable, diversified income streams to support more balanced portfolios and enhance overall returns.

MembersCap’s partnership with Archax is reportedly the first of several collaborations that the investment manager has planned for this year, as the firm looks to expand its footprint across both traditional and Web3 financial markets.

Lloyd Wahed, CEO and Co-Founder of MembersCap, commented: “MembersCap partnering with a digital marketplace like Archax is an exciting next step for us that increases our ability to provide a new group of investors access to institutional-grade reinsurance exposure. We’ve been impressed with the caliber of institutional funds like BlackRock, Fidelity, Aberdeen and others that Archax has curated and we’re humbled to be the first emerging fund sat alongside them.”

Graham Rodford, CEO and Co-Founder of Archax, said: “MembersCap were looking for a partner to work with on the tokenisation, custody and distribution for their tokenised reinsurance fund. Digital asset innovation is exactly what Archax is all about, and we’re delighted to be providing these services to them and adding further yield-bearing digital instruments to the Archax platform.”

Jeremy Williams, Head of Digital Strategy and Compliance at MembersCap, added: “Tokenisation and digital assets sit at the heart of our offering.  Harnessing the energy and potential of on-chain finance, while meeting and exceeding the expectations of our regulators and our partners, is a vital part of our success. Archax’s technical acumen enables us to offer a full-suite service to our investors.”