Since the industry’s inception in 2017, each year seemed like a fresh opportunity that could lead to the year of the security token. Now, 7 years later, 2024 has proven to be the year of the Real World Asset (RWA) 🏦. RWAs have expanded the definition to cover any physical asset that can be tokenized, excluding crypto assets like Bitcoin and Ethereum.
Older narratives like real estate 🏠 and private credit fund tokenization continue to grow organically. While billions of dollars worth of these products are being issued and placed, the attention this year has gone to a category that saw immense growth in 2024. The prior year, numerous funds for US treasuries, money market funds, and similar liquidity products started to gain traction.
Europe is poised for significant growth as European Securities and Markets Authority (ESMA)-regulated marketplaces come to market, while the tokenization industry adopts MICA rules 🇪🇺. Switzerland’s DLT Act and the UK’s pro-tokenization regulators are also attracting significant activity from institutions and DeFi alike. The Middle East and Asian hubs like Singapore, Japan, and Hong Kong are thriving under friendly guidance and clarity for issuing tokenized assets, soon to evolve into full-blown ecosystems built and designed for an on-chain capital markets infrastructure 🌍.
Finally, blockchain protocols have fully embraced the RWA narrative, recognizing and communicating to their community the importance of the technology 🔗. The opportunity to warehouse the data for hundreds of trillions of equities, bonds, real estate, and more presents universal excitement due to the potential to provide competitive utility for their respective chains.
