Exploring the Future of Tokenized Assets with Standard Chartered

be report According to Standard Chartered Bank, the market for tokenized real-world assets is predicted to reach $30.1 trillion by 2034.

This significant market growth highlights the increasing role of tokenization in transforming global trade and finance by increasing liquidity, accessibility, and efficiency. The report highlights the shift towards integrating digital assets into mainstream finance, reflecting the widespread adoption and scalability of blockchain technology and DeFi applications.

Kai Fehr, Head of Global Trade, Standard Chartered Bank Commented,

“We see the next three years as a critical juncture for tokenization, with trade finance assets coming to the fore as a new asset class. To capitalize on this trillion-dollar opportunity, collaboration from all stakeholders across the industry is essential, from investors and financial institutions to governments and regulators.”

Standard Chartered Bank’s analysis highlights the transformative impact of tokenizing trade finance assets, which have traditionally been underinvested but have high risk-adjusted returns and low default rates. Tokenization allows for fractional ownership, operational efficiencies and improved financial market infrastructure, unlocking new opportunities for investors and helping to close the $2.5 trillion global trade finance gap, analysts say.

The report highlights that the evolution of tokenization has been rapid, with important milestones that brought smart contracts and decentralized applications to the financial ecosystem, such as the introduction of Bitcoin in 2009 and Ethereum in 2015. It further states that regulatory frameworks and industry collaborations, such as Project Guardian, led by the Monetary Authority of Singapore, have further demonstrated the feasibility and benefits of tokenized assets.

As the market for tokenized assets expands, Standard Charter expects demand to surge, predicting that 69% of buy-side firms plan to invest in tokenized assets by 2024. This growing interest is driven by reduced trading costs, increased liquidity and the potential for access to a new asset class. The current market size for tokenized real-world assets is approximately $5 billion, excluding stablecoins, while the potential addressable market, including the trade finance gap, is estimated at $14 trillion.

Standard Chartered Report on Tokenized Assets

Standard Chartered Bank’s efforts, such as its successful pilot of an asset-backed security token on the Ethereum blockchain, highlight the practical applications of tokenization in improving market access and operational efficiencies. The report highlights the need for standardized processes, regulatory compliance and interoperability, and advocates for greater collaboration between financial institutions, regulators and technology providers to create an environment that is supportive of tokenization.

The report concludes that the financial industry is at a critical crossroads, with tokenization set to revolutionize asset management, trade finance and global economic activity. Standard Chartered Bank believes that adopting tokenization can help stakeholders increase capital efficiency, widen market access, drive innovation and pave the way for a more inclusive and resilient financial ecosystem.


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