BNY proposes a digital overhaul to unlock private market growth

BNY's research warns that outdated infrastructure is throttling private-market expansion and outlines a four-pillar digital redesign to modernize asset servicing.

According to a recent BNY Institute study, the surge in private-market assets—now exceeding $500 billion in semi-liquid vehicles and $1.7 trillion in private credit—has outstripped the legacy infrastructure that processes subscriptions, redemptions and secondary trades. Carolyn Weinberg, BNY's chief product and innovation officer, explains that the firm plans a ground-up redesign built on four pillars: universal asset identifiers, AI-driven extraction of contract terms into programmable smart contracts, token-based delivery-versus-payment settlement, and enhanced collateral utility.

The paper warns that without interoperable digital rails, tokenization could simply reproduce existing silos. BNY's chief commercial officer Cathinka Wahlstrom adds that such infrastructure would shift liquidity management from a back-office task to a core market function. The bank is also developing internal precision-AI tools to map unstructured data and support client knowledge needs.