Cryptocurrency news

McKinsey estimated the capacity of the asset tokenization market by 2030

Forklog / 24.06.2024 / 09:17
McKinsey estimated the capacity of the asset tokenization market by 2030

The volume of tokenized assets will reach $1.9 trillion by 2030, despite the "cold start". Such estimates were brought to McKinsey.

In a more optimistic scenario, this value may be twice as high. Analysts have become more skeptical about the likelihood of its implementation. The pessimistic option assumes an increase to $0.8 trillion.

Data: McKinsey.

Experts noted that tokenization has received a "noticeable boost", but so far we are not talking about widespread adoption of the technology. 

Upgrading the existing financial infrastructure is "difficult, especially in such a regulatory-heavy industry as financial services," they added.

According to analysts, the following asset categories will overcome the $100 billion mark:

mutual and exchange-traded funds;loans and securitization;bonds and ETNs;alternative asset funds.Data: McKinsey.

Experts excluded stablecoins, deposit tokens and CBDC from calculations.

McKinsey noted that tokenization faces a typical "cold start problem" when initial investments are required from users.

The technology has problems with limited liquidity, which constrains the release of instruments. Due to fears of losing market share, issuers may issue tokenized assets while simultaneously using the TradFi infrastructure.

Analysts added that use cases are needed that have advantages over traditional financial systems. They named bond tokenization as an example.

At the moment, the market for such instruments has reached billions of dollars. Their advantages over traditional issues are insignificant, and secondary trades remain "scarce".

To change the situation, the experts proposed to develop a use case in which the digital representation of the collateral would provide greater mobility, faster settlements and increased liquidity.

According to experts, the first players who "catch the wave" of tokenization are able to stake out a large market share, strengthen their reputation and take on a key role in shaping standards. Now many institutions are in a wait-and-see position.

"There are indicators indicating that tokenization has reached a tipping point. These include a blockchain capable of processing trillions of dollars, unhindered communication between networks, as well as the development of a regulatory framework that provides clear recommendations on data access and security," the experts concluded.  

Recall that over the past year, representatives of the Fortune 100 list have increased the number of supported blockchain initiatives by 39%, to a "record level," according to Coinbase. The focus of attention of corporations is, among other things, the tokenization of RWA.

Source
Recently News

© Token Radar 2024. All Rights Reserved.
IMPORTANT DISCLAIMER: All content provided herein our website, hyperlinked sites, associated applications, forums, blogs, social media accounts and other platforms (“Site”) is for your general information only, procured from third party sources. We make no warranties of any kind in relation to our content, including but not limited to accuracy and updatedness. No part of the content that we provide constitutes financial advice, legal advice or any other form of advice meant for your specific reliance for any purpose. Any use or reliance on our content is solely at your own risk and discretion. You should conduct your own research, review, analyse and verify our content before relying on them. Trading is a highly risky activity that can lead to major losses, please therefore consult your financial advisor before making any decision. No content on our Site is meant to be a solicitation or offer.