Real World Asset Tokenization A Promising Niche in the Crypto Market

According to research, the token Real world assets (RWAs) will be one of the major growth sectors in 2023.

In its latest report dated January 4, analytics firm Coinmetrics highlighted growth areas for the crypto industry in 2023. It cited the tokenization of real-world assets as one of those growth areas.

The process involves representing physical and traditional financial assets in the form of digital tokens on the blockchain. Tokens can be bought, sold and traded just like securities.

Furthermore, it allows for a more secure and efficient investment environment for those who do not own or cannot hold physical assets.

Real World Assets in 2023

The crypto bear market sees tokenization of real-world assets in the latter half of 2022. Nevertheless, Coinmetrics still sees this as a growth area.

“Despite this decline, RWA tokens remain a promising area of ​​growth in the crypto market.”

It cited the example of several banks recently piloting a program to tokenize various projects to reduce transaction settlement times. beyond, J. P. MorganDeutsche Bank and SBI to trade tokenized currencies and sovereign bonds in November 2022. they used it Ethereum layer 2 scaling network polygon for use.

“This reflects the adoption of the RWA token by major financial institutions and the adoption of L2 for scaling,” the report said.

DeFi Pioneering MakerDAO is also venturing deeper into real-world assets. the creator‘s ‘endgame planproposes to make Midwife A free-floating asset, initially collateralized by real-world assets. moreover, DeFi stablecoin Protocol recently allocated funds of $400 million in short-term Treasuries and $100 million in investment-grade corporate bonds.

RWA backed loans have also increased. CoinMetrics said this indicates “increasing demand for the RWA token as a means of financing real-world assets”.

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High demand for tokenized assets

ArcBlocks and Adapt3r announced A strategic partnership to onboard new institutional partners in December. The pair started with US banks using on-chain financing from real-world assets.

according to financial TimesAmid the downturn in the NFT market, non-fungible token creators are diversifying RWA to generate new revenue.

Additionally, financial services company WisdomTree has launched a digital fund that tracks the Treasury Bond Index. Coinmetrics concluded:

“Overall, the adoption of RWA tokens in the crypto market is on the rise, with major financial institutions and platforms exploring the use of these tokens in various transactions.”

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BeInCrypto has reached out to the company or the person involved in the story for an official statement regarding the recent development, but has yet to hear back.


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