The following article is an executive summary of our whitepaper: A Quick Guide to Distributed Ledger Technology (DLT) and Alternative Investing.
Private market strategies are becoming more complex, sophisticated and sought after by investors – yet for all that innovation, the infrastructure that supports them has been slow to evolve. Alternative investing still relies heavily on manual processes, disconnected systems and paper-based workflows – all of which introduce friction at precisely the point where scale and efficiency are most needed.
Distributed ledger technology (DLT) could be the key to solving for these challenges. When implemented through permissioned networks, DLT doesn’t just modernize recordkeeping – it can redefine how firms collaborate, process transactions and meet regulatory demands across the private market ecosystem.
Corastone’s infrastructure is purpose-built to bring these capabilities into the real world of institutional investing.
The Case for Modern Infrastructure
Investor interest in private markets is growing. According to a recent Bank of America study, younger investors now allocate significantly more of their portfolios to private assets than previous generations. But access remains uneven, and operational complexity continues to limit broader adoption.
For asset managers, fund administrators, custodians and advisors, the challenge is not just product innovation – it’s infrastructure readiness. Can your current methods of handling increased demand for private market access stand up to growing volumes, expanding fund structures and rising client expectations, without increasing headcount or operational risk?
DLT helps firms meet these challenges head-on by creating shared systems of record that reduce friction and scale operations more effectively.
What DLT Actually Does
At its core, DLT is a shared, immutable ledger. It enables independent organizations to contribute to a common transaction record – without surrendering control of their own books and systems. This is especially relevant in private markets, where each participant (from GP to advisor) must maintain accurate records but is often working from inconsistent or incomplete data.
Permissioned blockchain networks enable structured, real-time data sharing – securely and with full auditability. Transactions are captured once, made visible to authorized parties and preserved without the need for reconciliation across systems. The result: less friction, fewer errors and stronger compliance.
Importantly, permissioned blockchains use account-based identity rather than private keys. This ensures firms retain access to records even if users lose credentials – a significant advantage over public-chain models when applied to high-value, regulated transactions.
What DLT Doesn’t Do – And Why That Matters
DLT is infrastructure. It is not a liquidity engine, and it won’t transform a 10-year closed-end fund into a liquid daily vehicle. Tokenization – often seen as a liquidity solution – simply wraps an asset in a digital representation. It doesn’t change the underlying terms, conditions or market structure. Its role is foundational – not transformational in isolation – but it lays the groundwork for real progress.
But what DLT does do is improve the conditions under which liquidity solutions might emerge. By standardizing how alternative assets are recorded, accessed and transferred, it enables new platforms, transfer mechanisms and fund innovations to operate with greater confidence and less operational drag. That’s what we’re focused on enabling via the Corastone platform.
Choosing the Right Model
Public and permissioned blockchains share the same foundational mechanics, but their use cases are very different. Public chains offer full transparency, but little privacy or access control. That model may work for cryptocurrency – but it doesn’t suit the demands of regulated institutions handling investor-specific data and eligibility requirements.
Permissioned blockchains, by contrast, enable KYC/AML enforcement, information controls and private collaboration among trusted parties. These attributes make them especially well-suited to alternative investments, where regulatory complexity is the norm, not the exception.
Corastone’s architecture follows this model: each participant maintains its own records while engaging with a shared, verifiable ledger. The infrastructure is modular, scalable and designed to evolve alongside the market it serves.
Conclusion: Innovating the Private Markets
As private markets continue to mature, the firms best positioned to lead will be those that invest in infrastructure equal to the task. DLT, thoughtfully applied as a foundation to connect all ecosystem participants, brings order to complexity and structure to scale.
Corastone provides the infrastructure that makes this possible – with the clarity, control and mission that institutions demand. In private markets, where stakes are high and expectations are rising, those qualities matter.