Research by the Boston Consulting Group (BCG) suggests that tokenization of illiquid global assets could become a $16 trillion industry by 2030. Real-world assets include stocks, bonds, mutual funds, and other financial instruments.
They can also include commodities like gold and silver and real estate.
Furthermore, analysts predict that this will become a catalyst for mainstream crypto adoption.
A crypto sector is estimated to reach $16 trillion by 2030:
Real world assets.
This will be the CATALYST for mainstream Crypto adoption.
Here’s your 2023 guide to RWA (and the major protocols): pic.twitter.com/bGudNQX0zq
— Edgy – The DeFi Edge 🗡️ (@thedefiedge) March 30, 2023
Real world assets a “killer use case”
According to Citi Group’s latest Global Solutions and Insights (GPS) report, RWA tokenization could become a “killer use case.”
In its March report, Citi wrote that there would be up to $4 trillion in tokenized digital securities and up to $5 trillion in central bank digital currencies (CBDCs) circulating around the world.
Citi GPS Managing Editor Kathleen Boyle predicted that adoption will be driven by CBDCs, tokenized assets in games, and blockchain-based payments on social media, adding:
“Successful adoption will be when blockchain has over a billion users who don’t even realize they are using the technology.”
Executives in the crypto industry have echoed the sentiment.
“So obvious that tokenized ownership and contracts will be the norm in the next 5-10 years.” saying Circle CEO Jeremy Allaire on March 29.
DeFi analyst ‘Edgy’ highlighted some of the recent examples of RWA tokenization, such as Amazon NFTs tied to real-world assets.
In addition, Goldman Sachs thrown out a digital asset platform (GS DAP) earlier this year to tokenize traditional assets.
The Monetary Authority of Singapore is testing asset tokenization through Project Guardian, and Siemens issued a €60 million bond on Polygon, so it’s already happening, he said.
RWA tokenization also offers more stable returns compared to highly volatile DeFi returns influenced by cryptocurrency bullish and bearish cycles.
Other benefits include more flexible investments, as a token can be used to buy a fraction of a property for those who can’t afford it all. It also makes traditional assets like art, real estate, and private equity more liquid and easier to trade.
RWA protocols
There are already a number of cryptographic protocols that deal with the tokenization of real-world assets. These include GoldFinch, Centrifuge, TrueFi, Maple Finance, and DeFi pioneer MakerDAO.
Maker’s ‘Endgame Plan’ proposes turning its DAI stablecoin into a floating asset, initially collateralized by real-world assets.
Binance Free $100 (Exclusive) – Use this link to sign up to receive $100 free and 10% off your first month’s fees for Binance Futures (terms).
PrimeXBT Special Offer: Use this link to sign up and enter the code CRYPTOPOTATO50 to receive up to $7,000 on your deposits.
