Luxembourg is leading this transformation with the revamped European Long-Term Investment Fund (ELTIF) framework, which opens private asset markets to retail investors. ELTIF 2.0 lowers minimum investments, offers greater liquidity, and targets diversified sectors like real estate, infrastructure, and private equity, making it appealing for retail participation.

Challenges remain, including liquidity constraints and operational complexities, as traditional private fund structures often do not align with the needs of smaller investors.

Retail investors enter the frame for private assets

Historically, private equity and Alternative Investment Funds (AIFs) catered exclusively to institutional investors with significant entry thresholds and limited liquidity. Retail investors, however, demand lower entry points, transparency, regular updates, and some liquidity. To meet these needs, AIFs must adopt new models, with Distributed Ledger Technology (DLT) playing a pivotal role.

DLT enables tokenization, allowing fractional ownership of fund units and enabling smaller investments. This broadens access, enhances transparency, and improves fund distribution efficiency. By automating processes, DLT also reduces operational costs, errors, and manual tasks – critical for asset managers serving diverse investors.

Luxembourg’s Blockchain IV bill is transformative, enabling tokenized ELTIFs that are accessible and secure for retail investors. The law removes legal barriers, reshaping how private assets are managed and distributed through blockchain technology.

Blockchain IV: Making private assets retail-ready

The Blockchain IV law introduces an issuance account mechanism that simplifies access to private funds. Investors can use existing custody accounts or apps to trade fund units, integrating private assets into mainstream financial infrastructure similar to standard securities trading.

Direct-to-consumer (D2C) applications further enhance accessibility by providing user-friendly interfaces to manage private investments, reducing administrative barriers. Fund units issued under Blockchain IV are treated as securities, enabling faster and more efficient processing in line with global standards. Blockchain also embeds critical details into token terms, improving transparency, trust, and adherence to predefined parameters.

The future is here, and Luxembourg is ready to lead the change

The once-unreachable world of private assets is now within arm’s reach for retail investors. By integrating tokenized solutions into mainstream financial systems, Blockchain IV is setting a global precedent for accessibility, functionality, and inclusion in private markets.

For retail investors, the promise of participating in high-growth, private market opportunities is no longer a distant dream. It’s here and it’s now. And Luxembourg is making it possible.

The future of investing is brighter, smarter, and more inclusive than ever. With Luxembourg leading the change, are you ready to step in?

To discover more about digital assets and KPMG Luxembourg’s digital assets services, head to our and dive into more detail on private asset retailization in our latest blog .