What to Know:
- The market of tokenized assets, including stablecoins, is projected to reach $18.9 trillion by 2033, according to Ripple and BCG.
- The report highlighted tokenization of money markets, private credit, and carbon emissions as use cases offering operational efficiencies.
- Unclear regulations, lack of standardization, and market fragmentation are among barriers for broader adoption, the report said.
The market for tokenized financial instruments, or real-world assets (RWAs), is set to boom, with a projection for growth to $18.9 trillion by 2033. This insight comes from a recent joint report by Boston Consulting Group (BCG) and Ripple.
The anticipated average 53% compound annual growth rate (CAGR) positions this industry amid a pivotal moment, transitioning between conservative and optimistic forecasts.
Tokenization, which utilizes blockchain to manage ownership and transfer assets, has drawn interest from traditional financial institutions eager for efficiencies and quick transactions. The report notes significant activities from firms like JPMorgan, which has handled over $1.5 trillion in tokenized transactions.
“The technology is ready, regulation is evolving, and foundational use cases are in the market,” said Martijn Siebrand.
Among the key challenges affecting the market are fragmented infrastructure and uneven regulatory progress across different regions, complicating operations.
Despite these setbacks, early adopters are making swift advances, navigating the fragmented landscape towards wider acceptance of tokenized assets.
