Since Non-fungible Tokens (NFTs) exploded into the mainstream in late 2020 and early 2021, most people associate NFTs with pixelated Twitter avatars, squiggly lines, and jpegs of rocks. The most successful and best-known NFT projects created a market for digital art (CryptoPunks, Beeple’s Everydays, OpenSea). NFTs also brought collectibles and trading cards into the digital age (NBA Top Shots, Sorare, Parallel).

Someone plugged into the Crypto world might be familiar with NFTs representing digital items within video games and the Metaverse (Axie Infinity, Decentraland). However, the unique properties of NFTs (pun intended) hint at a myriad of fascinating future applications for this technology. Even though they are still in their infancy, we can already explore the opportunities NFTs create for various industries.

Let’s take a look at four emerging applications for NFTs and current projects in each space:

• NFTs representing digital objects
• NFTs representing physical objects
• NFTs representing identities
• NFTs representing financial claims

Representation of Digital Objects

The representation of digital objects in the Metaverse is most like the most popular application for NFTs: digital art and digital collectibles. Today’s NFTs are created and traded primarily for aesthetic and cultural value. On the other hand, future NFTs representing digital objects will have a commercial purpose.

Publishing & Entertainment

It is relatively easy to imagine the entertainment or publishing industries creating NFTs for movies, books, and other works of entertainment. Whenever a movie ticket is purchased, a song or film is streamed, or a textbook is resold, royalties could flow back to the creators and contributors. Classic digital literature and digital films would appreciate over time, enabling the digital collection of such works, much like collections of antique books or art today. And, if there were any ownership disputes, the blockchain’s records would eliminate any questions of provenance.

Journalism

NFTs became equally intriguing for journalists after Kevin Rose provided a proof of concept in the New York Times by minting an NFT of his article. Reporters and photojournalists could mint NFTs of their scoops and pictures on the spot to secure their copyright. In-depth reporting could also become an asset owned solely by the author, creating a future business model for talented journalists beyond bylines in legacy publications.

Disempowering such gatekeepers is just another example of decentralization.

Patent Law

Another avenue for tokenizing digital data is the patent system. Instead of filing an idea with a centralized platform and paying a high fee to a government agency, future inventors could record their patents in the blockchain and mint NFTs for patent licensees. These NFTs could have unique payment modalities attached to them. Under the current regime, innovators face prohibitive costs to protect their ideas by having to pay maintenance fees to uphold their patents. In the future, inventors could earn royalties from their work, sell it, or post it as collateral.

Representation of Physical Objects

Bringing physical objects into the digital realm is another possible future use of NFTs. For some, this is the most impactful implementation of NFTs because it most tightly binds together the physical world and the blockchain.

Real Estate

Real estate is an example of an industry where a central registry holds ownership records of physical objects. As a result, the sale and collateralization of a property incur high costs. A tokenized property title could be instantly bought and deposited as collateral for a mortgage or a DeFi loan with much less need for paperwork. Furthermore, owners would have the possibility to sell or pass on as inheritance partial ownership stakes of their property by burning the existing NFT and minting new ownership shares. These NFTs could also have different economic rights attached to them to differentiate the new owners. That way, transactions with physical real estate anywhere in the world would become as easy and fast as buying or selling land on Decentraland.

Supply Chains

Decentralized recordkeeping can also be very useful for managing efficient and secure supply chains by reliably and cheaply establishing the provenance and freshness of perishable foods, origin-specific delicacies, and medicines. An NFT representing a delivery could be automatically passed from wallet to wallet as it travels through the supply chain links, creating a fraud-proof record.

Physical Collectibles

Like digital collectibles, ownership of physical collectibles, sports memorabilia, and luxury items can be tokenized and securely recorded in the blockchain. Besides authentication, tokenization enables frictionless financialization of such objects. With the help of NFTs, they can be fractionalized, traded, and serve as loan collateral.

Representation of Identities

While putting digital and physical objects on-chain may seem obvious to someone familiar with NFTs, tokenizing identities may appear more abstract. However, unique identities and documents lend themselves well to be represented by unique tokens.

Certification

NFTs can serve as authenticated and forgery-proof diplomas, certificates, qualifications, and other academic and professional proofs of achievement. These tokens could contain unique smart contract characteristics, such as automatic payments of periodic membership fees, refresher course attendance checks, or expiration dates.

Personal Identity

Besides serving as tokenized certifications, NFTs can act as proof of personal identity itself. Imagine NFTs containing personal data, such as date and place of birth, serving as a digital ID within Web 3.0 applications. ID NFTs attached to a wallet could also help streamline know-your-client-processes (KYC), obliging providers of financial services to identify clients, and compliance checks while protecting their owners’ privacy by sharing data on a strict need-to-know basis.

Domain Names

An application of identity-NFTs, already familiar to most crypto natives, is the Ethereum Name Service (ENS), which encodes names as ERC-721 NFTs to represent Ethereum addresses and can be transferred just like any other NFT. Other services, like Unstoppable Domains, also offer decentralized domain names as ERC-721 NFTs. Besides creating an unfalsifiable identity, usable across the Web 3.0 ecosystem, domain-NFTs transform domains into assets. That opens them up to financial transactions, such as trading, collateralization, and fractionalization.

Representation of Financial Claims

Financial NFTs are probably the most futuristic use case for NFTs at the moment, but also one that has the most significant implications for the DeFi ecosystem. Representing financial claims with tokens turns them into financial building blocks, which can be combined into new financial products. This approach is a decentralized, trustless, and fully transparent reincarnation of asset-backed securities before the 2008 Financial Crisis.

Financial Engineering

Two examples of financial NFTs are Uniswap V3 Liquidity Pool NFTs and Solv protocol’s voucher smart contracts.

Uniswap introduced NFTs to replace V2’s LP tokens in May 2021. The main advantage of NFTs is their ability to represent unique characteristics of individual Liquidity Pool positions.

The Solv protocol blazes a trail to create so-called voucher NFTs (vNFTs) to stand in for locked-up portfolios of digital assets. These vNFTs are NFTs with built-in fractionalization and can be split and merged, traded, and used as collateral.

Revest Finance has chosen a similar approach by wrapping and locking any number of different ERC-20 tokens inside an NFT. Access to the original token portfolio is only possible upon meeting certain conditions like identity proof, the passage of time, or price appreciation. Twenty years from now, trust-fund kids will have an NFT paying them a monthly allowance in ETH.

Insurance

NFTs can also be useful for decentralizing the insurance industry. Armor Finance is a protocol for trading insurance coverage against the failure of various widely used smart contracts. While Nexus Mutual provides the underwriting for the coverage, Armor enables users to mint an ERC-721 NFT representing their coverage contract. These NFTs can then be traded or staked in the Liquidity Pool for further rewards.

The applications and possibilities for Financial NFTs are vast; however, the underlying infrastructure is still in its infancy. For NFTs to grow into an ecosystem of trustless finance, much work still needs to be done.

Ever since the invention of “Copy & Paste,” physical and digital realms existed in parallel without much interaction. The difficulty of introducing unique physical objects into the digital space with potentially infinite, indistinguishable copies seemed insurmountable.

NFTs can change that. Beyond recording ownership of digital art and collectibles, they offer the possibility to create unique digital representations of physical objects, individual identities, and financial claims which we can then use within DApps in various ways. Forays are already being made to use NFT-based tools for various applications, such as publishing/journalism, real estate, luxury merchandise, certification/identification, and financial engineering.

Founder teams are already working on building such platforms and apps. Creating a decentralized and trustless ecosystem based on NFTs would be a massive step towards a bankless future.

(published at medium.com – read source )

There are many possible reasons to shop around for a new Private Bank or Wealth Management provider. Maybe you just sold a business, went public with your company, received an inheritance, or would like to change your current financial advisor. When it comes to money, you should not take such fundamental decisions lightly. Below are the most important factors to consider when deciding whom to entrust with managing your proverbial family jewels. 

Safety First!

Priority number one when thinking about financial matters is safety. Naturally, if you want to grow your wealth and invest, you will inevitably take risks. However, it is vital to take only calculated risks and on your terms. A Wealth Management firm with questionable practices or a bank with a weak balance sheet is not the kind of risk you want to expose yourself to.

Make sure to research the company and its representatives. Read about its history and tradition, its management continuity, and the context of its mentions in the press. Read through the publications which might appear on the company’s website. Try to get a sense of the respectability, stability, and seriousness of the firm. However, remember that appearances can be misleading. Attributes like antique furniture, exquisite-looking art on the meeting room walls, or a family tree reaching back hundreds of years are sometimes not more than skillful marketing. Today, the Financial Services industry is a modern business, where systems and processes matter at least as much as a rich tradition.

Financials

Another essential matter to consider is the financial stability of the bank taking custody of your assets. If you are looking at a bank, be it a small Private Bank or a division of a large universal bank, ask the salesperson for a set of the latest financial reports. You might want to pay special attention to the balance sheet, particularly the amounts the bank owes relative to its overall balance sheet size. It could also be worthwhile to examine the profitability of the bank and the stability of its earnings. 

If you are talking to a large financial institution, ask to see an organization chart and locate the entity acting as the custodian of your wealth.      

It is possible that some of the providers you are considering will not have a banking license and will rely on one or several custodian banks to keep your accounts. Ask for detailed information about those banks, whether the Wealth Management provider has preferred custody banks, and whether it makes sense for you to divide your assets between two or more different custodians. 

Personality Matters

Having a solid financial institution taking care of your financial assets is a robust foundation for your Wealth Management setup. However, as a client, your experience will be determined by the person or team acting as the face of the organization. Consider that you will be working closely with your client advisor or relationship manager. You might want to share with them details about your private life, your dreams, and your fears. Think about how they may handle eventual conflicts of interest.

The establishment of a trusting relationship is a necessary condition for a fruitful collaboration. Consider your first impression and utilize your knowledge of people to understand whether you can develop mutual trust, understanding, and partnership with your advisor. Avoid being too deferential to their expertise as well as bossy behavior. Consider your interactions as a professional relationship among equals.

Beware of Marketing

A reason for caution is the ability of talented salespeople to adapt their persona to the prospect’s preferences. Examine your intuition whether you are witnessing an artful performance. An essential skill of relationship managers is to wrap a sale into a seemingly friendly piece of advice.   

Remember, unless you are negotiating with a boutique of a few people, you will have the possibility to request a different client-advisor if you change your mind in the future.

What Can You Do For Me?

A centuries-old tradition of the house, great chemistry, and blind understanding between you and the relationship manager will be of no use if the bank cannot provide the products and services to help you reach your financial goals.

Ask for a general overview of the capabilities of the institution and various service levels. Articulate as clearly as possible what objectives you are pursuing with the account opening. Allow the salesperson to find the combination of products with the best fit for your situation. However, a healthy dose of skepticism is appropriate, so you should watch out for jargon or marketing. Ask for explanations and examples should anything be unclear.

Don’t be Fooled

Mismatches between your stated requirements and products or services highlighted by the salesperson are possible red flags. For example, if you require hands-off discretionary management of your investment portfolio, the client-advisor should not stress the possibility to day-trade stocks. Such sales tactics can indicate an institution with limited capabilities and an unhealthy sales culture.   

First Class Service

Depending on your goals for the new account and how you would like to interact with it and the bank, you should not forget about various quality-of-life aspects. Elements to consider are the e-banking suite, clarity and structure of bank statements, and the ease with which you would be able to reach your client advisor or the team in an emergency. 

Ask for a demonstration of the e-banking application paying particular attention to the functions you expect to use most. These could be payments, trading, or downloading reports. Don’t forget about the mobile app for your smartphone!

Let your future client-advisor show you sample bank statements. Make sure you can understand the information therein and easily find the numbers you would most likely need.

Details Matter

From the interactions you have had until now, it might be challenging to discern the level of service you could expect from the team covering your account. Much less so, how it would behave in a situation of stress or eventual disputes. However, high quality often shows in the minor details. How the firm has treated you up to this point can give valuable clues about the level of service you would receive in the future.  

Everything Has Its Price

Finally, it is time to think about the cost of a Private Banking or Wealth Management service. Personalized coverage can be pretty expensive compared to a retail banking offering or a commission-free trading app. The level of service will also vary between different banks and their service models, and so will the prices. 

Behind layers of marketing and reputation, however, banking is a highly commoditized business. Similar service levels will produce similar experiences and results and should result in similar pricing. Therefore, you might want to watch out for outliers in terms of pricing and question whether a high price tag is indeed justified.    

Pricing Models

One important distinction to make, however, is the difference between pricing models. Most banks will offer two or more pricing models. These models differ in the degree to which brokerage fees for transactions or other costs are included in the package price and will range from a more expensive all-in fee to cheaper basic account maintenance and custody charges, where additional fees accrue on top of it. With your client advisor, you can work through concrete examples based on your expected transaction behavior and pick the appropriate option.

Last but not least, be aware that most banks do not expect to charge the listed prices in the fee schedule. Therefore, feel free to ask for discounts and special conditions and to negotiate. As a Private Banking client with custom requirements, you can demand custom pricing too.

Final Thoughts

Finding a Private Banking institution or a Wealth Management firm with the right fit for your specific needs is a complex affair with many moving parts. Consider the firm’s philosophy and stability, the personal fit with your client-advisor, the offering and the service level, as well as the fees of the various contenders. As a sophisticated client with particular requirements, you might want to prioritize the different aspects in a specific way. Take your time to examine carefully the documentation and information provided. Consider the option to maintain more than one account at institutions with different areas of excellence.

With the tips above, you should be well equipped to scrutinize the offers presented to you and pick the one(s) with the best offering to meet your wealth goals. 

A career in Wealth Management has somewhat lost its luster lately. However, it is still very desirable among many students and graduates. In the common imagination, Private Bankers are dressed in immaculately tailored suits, commute between Monte Carlo, Miami, and Hong Kong, and visit clients on their yachts and at polo tournaments. In reality, a successful career in Private Banking requires mastering an arsenal of hard and soft skills.

The job of a private banker requires establishing and maintaining harmonious relationships with clients, advising them on their investments, and reliably providing them with various other services around their wealth. The following five skills will help you fulfilling the profession’s multiple demands.

Interpersonal Skills

Private Banking is a people business. An essential requirement is being able to establish and maintain relationships with existing and prospective clients. Wealth Management clients are not less diverse than any other group of people. Advising this clientele requires adapting to different personalities and creating a feeling of respect, mutual understanding, and being in good hands. Some clients prefer a formal relationship at arm’s length, while others don’t separate professional matters from their private lives, especially when dealing with financial issues. You should feel equally comfortable anywhere on this spectrum and adapt to the individual quirks of your clients.

Another critical aspect of the interpersonal skills of a private banker is the ability to establish rapport with prospects quickly. Every relationship manager is interested in growing their client book. That means having an entrepreneurial spirit, networking at events, and obtaining referrals from existing clients. You have only one chance to make a first impression and lay the seeds for a future client relationship.

Finally, your emotional intelligence will come in handy when resolving eventual conflicts or dealing with critical clients and their complaints. A private banker is at once representing his clients’ interests within the organization and the client’s point of contact with the bank. Balancing this dual role requires delicate communication.

Sales and Persuasion

Salesmanship is a skill that is closely related to emotional intelligence. Nevertheless, it requires a separate mention. Private Banking is a business that means selling yourself, the bank, and its services and its products to the client or prospect. Naturally, as a private banker, you must provide unbiased and professional advice to your clients. However, first, you must gain the opportunity to give that advice. Once granted, you have to convince the client to follow your suggestions. 

One of the best ways to accomplish this is to employ a sales philosophy known as consultative selling. In a consultative sales process, the salesperson attempts to understand the client’s problem or need first, instead of having a product or solution in mind before even speaking with the client. After that need is clear, it is appropriate to reach into the toolbox and pick the right tools to fulfill the identified need. A critical skill for effective consultative selling is listening to the client actively, understanding their needs, and making the client participate in finding the solution. You should be able to walk a client of any sophistication level through the pros and cons of various options to tailor the final solution together and make your client all but arrive at the result themselves.

Another aspect of salesmanship is the ability to provide excellent client service. The best client acquisition and portfolio management skills will matter little if the client does not walk away from any interaction with you feeling to have received the best possible service. Undoubtedly, clients demand high returns with low risks from their banking relationships. However, as a private banker, you are ultimately in the business of providing your clients with a holistic and exclusive banking experience.

Financial Markets and Products

As a private banker, no financial matter is off-bounds in your conversations with clients. You will have to explain and advise on any financial product or concept a client might bring up in a conversation. These conversations can also touch upon related topics like wealth or retirement planning, tax matters, a mortgage, or yacht financing.

You can’t be an expert on every topic. Depending on the size of your organization, you might be able to draw on various in-house specialists. However, as the point of contact between the client and the bank, you will be responsible for translating that expertise into a language the client can understand and use for their decisions.

Besides financial markets and product expertise, clients will also expect you to stay up-to-date on major political and economic events impacting financial markets. It is also helpful to be well-read and have command of a wide range of topics outside of financial markets.

Organization and Time Management

Most private bankers manage a book of several tens of clients. Developing a system to keep track of every client relationship and stay on top of any to-dos and discussions with every client is every relationship manager’s responsibility.

Such a system is especially life-saving in moments of high stress when markets are volatile and client orders and inquiries keep rolling in one after another. You have to keep a cool head, stay organized, and find a way to prioritize your tasks and meet your clients’ demands.

Responding to client requests in a timely and organized manner will also make your clients feel important and well cared for, which is vital to strengthen the client relationship and develop trust.

Reliability

Staying on top of tasks and projects is essential not only in times of heightened client activity but is a requirement in the day-to-day life of a private banker. Managing other people’s money is laden with responsibility and has more significant consequences than many other professions. Therefore, for the sake of your peace of mind and the health of your client relationships, clients must feel that they can rely on you to execute their instructions and answer their questions correctly and promptly.

Unfortunately, mistakes are unavoidable when humans are at work. Nevertheless, it must be your priority to avoid them as much as possible, taking time to check your work. Many tasks, requests, and questions you receive from clients will be time-sensitive and sometimes involve large sums of money. Much of what you will do in financial markets will not be reversible without costs, so learn to work with precision while avoiding unnecessary time delays.

Being professional and reliable in everything you do will serve as the foundation for strong and successful client relationships.

Final Remarks

A career as a Private Banker for wealthy individuals requires many talents and skills, aside from financial markets expertise. You must develop relationships with different types of people, be solution-oriented, and stay on top of your everyday work and promises given to clients. 

Add salesmanship and entrepreneurial spirit to the mix, the ability to grow your book, and your private banking career can take off.