4.1 Who are the target buyers?

Retail and Institutional investors

Subject to clearing KYC/KYB checks, $BRICS is accessible to both institutional and retail investors. Investors hold the token for two reasons: arbitrage yield and capital relief. Thus, $BRICS plays a dual role: (a) as a quadratic measure of CDS revenue and (b) as a governance token that determines where credit risk is offloaded

The former seeks crypto-native value accrual with real-world impact. The latter sees $BRICS foremost as a governance token, offering pro-rata governance rights to critical collateral and bank credit-enhancement decisions.

$BRICS holders are segmented into three non-exclusive categories below:

1. Motivated by capital relief and governance:

   1. Banks: Credit Portfolio Managers, like Nhlanganiso Kunene, Head of Debt Capital Markets at Nedbank, represent the 'investor-face' of commercial banks with trade finance portfolios. Nedbank Group Limited is a $7.5 billion market-cap bank operating in five African countries within the Southern African Development Community (SADC) region including 2 BRICS nations. Its 21% shareholding in Ecobank extends its presence to 39 other African countries. Nhlanganiso seeks both regulatory capital relief and governance arbitrage through $BRICS. Synthetic CDOs allows banks to limit regulatory capital charges and reduce economic risk while retaining ownership of the attendant assets.

2. Motivated by regulatory arbitrage and compliance:

   1. Underwriters and insurers seek ever-green CDS markets to govern and buy out. Think here of Nsika Mosondo, Chief Financial Officer of the ‘Old Mutual-NASASA Facility’. Nsika provides the full notional guarantee on bank-originated credit. Why? Old Mutual is a multi-line insurer and bank ($ 4 billion market cap) operating across Africa and Asia. Nsika is buying a 'token warrant': the option to govern at least $500 million in trade finance over Africa and Asia. This is a strategic governance (i.e. risk management) advantage which, as a bank, he cannot exercise through equity post 2008 regulations. The cost of the opportunity is minimised through an AI-selected CDS portfolio, which Nsika deems superior to industry-standard Logit predictions of risk. Consider the calculus: Nsika believes a $500 million guarantee can bootstrap a $2 billion guarantee for the bank within 2 years through CDS-reinvestments. The expected loss is $7 million; the net benefit is over $400 million in protocol profits, compliant governance rights (hedging), and earned credit fees for the bank.

   2. Stablecoin issuers that require compliant collateral and institutional-grade yield-enhancement, like Tether. One might also view this as a hedge against non-compliant p2p stablecoin payments (yet long on dollar hegemony).

   3. Hedge Funds: asset managers like Blackrock are increasingly seeking compliant crypto-native yield and leveraged return through synthetic risk transfer.

3. Motivated by real-world impact, crypto-native transparency and capital redistribution

   1. Crypto Funds: ‘bullish’ that PayFi has ‘product market fit’ and seeking an iteration into ‘regulatory arbitrage’ with attractive (or hedged) returns in a post-Trump era.

   2. Family Offices: long on dollar hegemony yet seeking censorship-resistant value accrual.

   3. Retail investors: attracted to the real-world use case and memetic quality of “BRICS bonds”, “Nike bonds”, etc. Prototypical is Noah Tweedale of Pump.fun (a meme coin launchpad targeting retail investors). There is also socio-political (PolitFi) appeal to a 'BRICS' token that captures the increasing manufacturing strength of the Global South and BRICS in particular. Finally, retail investors are attracted to the leveraged returns of tokenised CDOs, simialr to that seen in the meme coin market.

Interestingly, the supply side of CDS premiums (banks seeking risk transfer) is also a critical demand side (banks seeking $BRICS as a means of governance arbitrage). This reflexive relationship was imposed by the Bank of International Settlements post-2008: banks are restricted from owning more than 20% in SPV equity underwriting risk transfer despite the need to manage risk mitigation. This enables third-party brokerages like ChinaAI to sell tokenised governance instead, enabling banks to bypass regulatory restrictions.