A new research report from Standard Chartered discusses the current state and future of real asset tokenization beyond stablecoins.
Tokenization and Its Benefits
Tokenization, the process of transforming physical or traditional financial assets into blockchain-based digital tokens, has garnered growing interest from traditional finance. However, according to Standard Chartered, only $23 billion is tokenized in non-stablecoin RWAs, roughly 10% the size of the stablecoin sector. The bank expects significant growth in this segment as focus shifts towards more impactful blockchain applications.
"To unlock growth potential, we believe tokenization efforts need to focus on on-chain assets that are cheaper and/or more liquid than their off-chain equivalents, with shorter settlement times, or that solve an on-chain need," said Geoff Kendrick, head of digital assets research at the bank.
Regulatory Changes and Challenges
The report acknowledges that regulatory advancements in jurisdictions such as Singapore, Switzerland, the EU, and Jersey have laid the groundwork for broader adoption. However, fragmented KYC rules still present obstacles to seamless tokenized finance.
The Future of Asset Tokenization
Despite existing challenges, Standard Chartered remains optimistic about the prospects of tokenization, highlighting the growing momentum within the financial industry to move beyond stablecoins and unlock new efficiencies through blockchain-based representations of real-world value.
The report from Standard Chartered highlights key aspects of real asset tokenization and underscores the need for further efforts to overcome regulatory barriers for successful development of this segment.
