Tokenization: A Promising Future for the Financial Market

02/25/2023 22:06 • Daily Digest • 233 views

It is reported that in a recent report, HSBC and Northern Trust predicted that by 2030, 5% – 10% of all assets will be tokenized. According to McKinsey’s data, the total assets under management in 2021 will reach 126 trillion US dollars, while BCG’s figure is 112 trillion US dollars. Using McKinsey’s figures and a compound growth rate of 5%, the AUM will be about 195 trillion US dollars by 2030, with tokenization accounting for 5% to 10% of this figure.

HSBC: 5-10% of assets will be tokenized by 2030

Interpretation of the news:

The financial world is changing rapidly, and the emergence of cryptocurrency and blockchain technology have become a hot topic in recent years. The latest report by HSBC and Northern Trust has predicted a remarkable change in the financial sector. The report suggested that a significant portion of the assets under management (AUM) will be tokenized by 2030. Tokenization is a process of converting traditional assets into digital tokens that can be traded instantly and seamlessly on blockchain networks.

The report projected that from 5% to 10% of all assets will be tokenized by 2030. This is a significant transformation in the financial landscape, which is worth contemplating. McKinsey and BCG provided two distinct figures regarding the assets under management in 2021, which are 126 trillion US dollars and 112 trillion US dollars, respectively. The compound growth rate of 5% suggests that the AUM will reach 195 trillion US dollars by 2030. It is estimated that tokenization will play a role in 5% to 10% of these assets.

The tokenization of assets can bring transparency, speed, and cost-efficiency to the traditional financial system. It provides the chance of fractional ownership and enables small investors to participate in assets that were previously out of reach for them. Tokenization will democratize the investments, providing equal opportunities to anyone interested in investing in assets. It will improve the liquidity of traditional illiquid assets by enabling them to tokenize and trade on blockchain networks.

The possibilities for tokenization are vast, ranging from real estate and artworks to commodities and shares. Tokenization has the potential to revolutionize the financial world and bring agility and transparency to the sector. It is expected that tokenization will create a significant impact on the financial eco-system in the coming years, and traditional investors need to adjust their investment strategies accordingly.

In conclusion, tokenization is an exciting technology that brings new opportunities to the financial market, and the forecast for 5% to 10% of all assets to be tokenized by 2030 highlights the growing trend towards this digital transformation. It is a fantastic opportunity for small investors interested in credible, valuable, and liquid assets previously unavailable to them. Tokenization will undoubtedly create a major impact, and investors must stay up to date with the latest developments in the financial sector to take full advantage of this futuristic technology.

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Tokenization: A Promising Future for the Financial Market

HSBC: 5-10% of assets will be tokenized by 2030

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