Tokenization of Real-World Assets: Assessing Market Sentiment

Security Token Market estimates that there are currently $16.5 billion of security tokens trading in the secondary market. JPMorgan claims to have processed almost $700 billion of tokenized short-term loans. Broadridge is currently using a blockchain based repo platform for $1 trillion per month in transactions. Boston Consulting Group and the World Economic Forum suggest that the tokenization of global illiquid assets is estimated to be a $16 trillion business opportunity by 2030.

Texture Capital conducted a survey of 40 executives across fintech, finance and web3. Highlights include:

a) Most participants strongly agreed that tokenization of real-world assets is likely to see increased adoption over the next 24 months.

b) The top perceived benefit is the lower cost of issuance and servicing (63%), followed by increased liquidity (55%).

c) Real Estate was the most popular asset class for tokenization (58%), followed by Alternative Assets such as art and music royalties (40%), and then private company shares (38%), and private equity funds (30%). Public equities such as TSLA & AAPL were the least favored (8%).

d) The perceived challenges were lack of regulated infrastructure (58%), clarity of and compliance with regulations (45%), lack of liquidity providers/market makers (43%), costs of custodians/transfer agents/service providers (25%), lack of high-quality assets ready to be tokenized (18%).

The full report is available at Texture Capital

Posted in Tokenization.