Tokenised, Regulated and Ready For Investment

Speaking to hosts Mohammed Nalla and The Finance Ghost, Bloem went back to the basics of investment and capital markets. “A market is a dynamic organism,” she said, “but the constant reality is that companies are trying to grow, to become more profitable and to make more money for their investors.”

To stay on that growth path, companies can either grow by increasing their revenue or by raising capital. Traditionally, public markets have been seen as the only option for raising capital (an outdated construct that Mesh continues to challenge).

“Public markets created a regulatory space to derisk against bad behaviour and bad actors,” Bloem said, pointing to a history of market-shaking events that prompted a regulatory response.

“Every time a bad thing happened, we said, ‘Never again’,” she said. “2001’s dotcom bust? ‘Never again.’ 2008? ‘Never again.’ Covid? Never again. And maybe now in 2025, with the US tariffs coming in, we’ll say, ‘Never again’… again.”

But kneejerk regulatory reaction fails to address the fundamental questions. “Every time ‘Never again’ happens, we just increase the amount of regulation, instead of asking ourselves: ‘Is this still the principle that we want to maintain? Is this still good for our economy?’ Regulators also have a responsibility to ensure that the economy can grow. You can’t over-regulate. You can’t lock your public markets up to such an extent that there’s no longer space in which companies can grow.”

Embedded Compliance in Tokenised Assets

Tokenisation has a key role to play here, creating a space where assets have – as the Ripple/BCG report termed it – “embedded compliance”.

The report noted that early token projects had “sacrificed some trust when they were overhyped, underregulated, or poorly executed”. But, it added: “Tokenisation has since moved into institutional finance, where transparency, auditability, security, and compliance are core requirements.”

Bloem spoke to this point in the Magic Markets podcast, while clarifying Mesh.trade’s role as an investment platform.

“We approach this problem statement by taking a principles-based approach,” she said. “There are certain constructs in the market that should be there to take care of certain things. You don’t want Mesh to be your second SARS or your second SARB. You’re already paying for those things and you already have them. You already have CIPC to oversee the execution of the Companies Act. You already have your board of directors. You already have your annual financial results and financial returns. Those are your basic principles. I think we should honour those constructs a lot more and not ask companies to double up on those efforts.”

The core question when it comes to compliance, she said, is whether an issuer adheres to the laws and regulations of the country in which it is established. This includes the issuer’s responsibility to communicate regularly and transparently with its investors.

Tokenised, Regulated and Compliant

What, then, does a compliant tokenised asset look like in the real world? Here Bloem cited the example of that landmark Die MOS 10Y Prime +2% Floating Rate Bond.

“It’s what we would call a private market public offer,” she said. “We have retail clients invested in that asset, and we need to make sure that it adheres to the relevant regulations. So firstly, it has a registered prospectus detailing what the CIPC says it needs to do to raise the R100 million. The bond’s one-year anniversary in 2025 means it needs a financial audit, which Die MOS needs to communicate to its clients.”

Principles Over Bureaucracy: Mesh’s Regulatory Mindset

There’s another layer of regulation to the assets listed on Mesh.trade’s platform: Mesh itself is also subject to regulatory requirements. This again speaks to Mesh’s role in the Finance 3.0 ecosystem. “We’re not trying to be the regulator in the sense of a public market,” said Bloem. “We are trying to be a conduit for issuers to execute on the responsibilities they have.”

What Bloem describes is a refreshing, back-to-basics approach that’s reshaping Finance 3.0 from a high-tech space that – as Ripple and BCG highlighted – could in some cases be prone to too much hype and too little regulation.

And as tokenisation shapes the future of capital markets, platforms like Mesh.trade are bringing back a focus on fundamentals. As Bloem concluded: “We’re really just sticking to the principles that any good market is based on.”