How to tokenise a fund in Australia

Stage 1: Legal preparation

The first step in tokenising a fund in Australia is a legal review of the fund's constitutional documents, the trust deed, constitution, or shareholder agreement, to confirm that they permit on-chain ownership records and electronic transfer of interests. Many modern fund constitutions already accommodate this. Older constitutions may require amendment.

At the same time, the fund manager should confirm the regulatory classification of the fund and its investors. Fund structures may be wholesale or retail, each with different disclosure and compliance obligations. Your specific obligations should be confirmed with your legal adviser. Retail fund structures involve additional disclosure and compliance obligations.

The Australian Government's March 2025 Statement on Developing an Innovative Australian Digital Asset Industry confirmed that existing legal frameworks apply to tokenised assets. There is no separate tokenisation licence required in Australia. The fund manager's existing AFSL (or their reliance on an AFSL holder) covers the issuance of tokenised fund interests in the same way it covers traditional interests.

Stage 2: Platform onboarding

Once the legal framework is in place, the fund manager completes Tokeniser's platform onboarding process. This involves entity verification for the fund manager and the fund, configuration of the fund's details on the platform, and setup of the administrator accounts for the team members who will manage the register.

For new funds, this stage also includes the design of the token parameters: the asset class, the compliance rules to be encoded (investor eligibility, transfer restrictions, foreign ownership limits), and the corporate action schedule.

Stage 3: Compliance configuration

Tokeniser's compliance layer is configured at fund setup and enforces rules automatically at every subsequent transaction. The compliance configuration covers KYC/AML verification requirements for investors, investor eligibility criteria (wholesale status, accredited investor status, foreign investor limits), transfer restrictions (lock-up periods, permitted transferee classes), and any fund-specific restrictions required by the constitutional documents or the fund manager's AFSL conditions.

Once configured, these rules operate automatically. The fund manager and administrator do not need to manually verify each transaction against them. The platform enforces them and flags any exceptions for review.

Stage 4: Investor register establishment

For a new fund, the investor register is established on-chain at the point of the first token issuance. Investors complete digital onboarding, identity verification, investor classification, and wallet setup, before their tokens are issued. The on-chain register is the register of record from day one.

For an existing fund migrating to Tokeniser, the existing holder data is verified and migrated onto the platform. Each existing investor completes digital onboarding to create their wallet and verify their identity and investor classification under the new platform. Once the migration is complete and verified, the on-chain register becomes the register of record and the traditional register is retired.

Fund type variations

The process above applies broadly across fund types, but there are variations worth noting. Managed investment schemes registered with ASIC involve additional disclosure and compliance obligations compared to unregistered wholesale schemes. Private equity and private credit vehicles may have more complex transfer restriction requirements. Property funds may involve additional stamp duty considerations on transfer. Tokeniser's onboarding team and specialist legal advisers can advise on the specific requirements for your fund type.