📈 $600 Billion Tokenization?

You’ve heard us say it before – tokenization is on the up and up. 🚀

Our old friends at Boston Consulting Group agree, calling for $600 billion in tokenized assets within the next five years. ⌚

🎯🔥 Rapid Fire Takeaways:

📜 Treasury Discusses Tokenized Treasuries

📈 RWA sector could reach $600B in next five years: BCG

🤨 SAB121 Exemptions Challenging to Recieve 

💰 GnosisDAO to Invest $40M in Early-Stage RWA Projects, Payments and Crypto Infrastructure

⚖️ If No Tokenized Deposits, Then CBDC Inevitable - BOE

🔌 BIS Debates Ending Project Eyed by Putin to Undermine Dollar

🤝 HKMA partners with Thailand and Brazil on cross-border tokens

No wonder the US Treasury recently met to discuss tokenized treasuries and their relative benefits… they listed several benefits! ✅

Maybe they should reconsider the notoriously difficult-to-obtain SAB121 exemption, which would really kick the party off. 🥳

😎 Asset Management Goes Tokenized 

Boston Consulting Group wasn’t done with their $600 billion call – they’re also calling tokenization the “third revolution in asset management” and predicted $100 billion in tokenized mutual funds on the horizon. Backing that up, BBVA Asset Management kicked off a tokenized fund in the CNMV sandbox, and Lazard is also collaborating with Bitfinex on a tokenized fund. 💥

Treasuries are also in the spotlight, with Franklin Templeton becoming the first asset manager to bring its fund to the Base blockchain. It also launched its UCITS fund, making it a big week for the tokenizer. Liberara and FundBridge also took T-Bills to task, collaborating together on their US Treasury fund. A good week for Uncle Sam. 🦅

🕴️ Institutional Infra and Partnerships

Every week, tokenization gets easier. Standard Chartered’s DLT system is already turning a profit, and OKX named them as their institutional crypto custodian. Garanti BBVA is collaborating with Ripple and IBM on tokenization initiatives, while DigiFT and Chainlink are enhancing tokenized money market liquidity. 💧

Speaking of liquidity, L-Bank issued €50 million in digital commercial paper with Clearstream, and OCBC used JP Morgan’s Onyx for some reverse repo intraday transactions. Top that off with Archax buying King & Shaxson Capital Markets, a Spanish broker, to hasten its European expansion and the week was filled with institutional invigoration. ⚡

However, not all initiatives are successful. Intel-backed R3 is considered a sale, given its struggle to find a product market fit. Perhaps Dave Hendricks of Vertalo said it best – it takes more than smart contracts to make magic happen. 🧝

🌐 Real World, Real (Tokenized) Assets 

On-chain action is moving with Solana, which is having a busy week. Agridex is working with Bridge (which, if you recall, Stripe just purchased for a cool $1.1 billion) on agricultural trade settlement. At the same time, Solayer launched an RWA-based stablecoin, sUSD, on the Solana network. 🟣

The growth isn’t isolated, though. GnosisDAO is set to invest $40 million in early-stage RWA projects, including payments and infrastructure. Further off-chain, the Nairobi Securities Exchange joined the Hedera Council for security tokenization in Kenya. Big names keep collaborating, like Banco Santander, Lloyds Banking Group, and UBS, who worked with Fnality to settle uncleared bilateral margin payments using a DLT system. 💻

🏛️ Central Banks and Regulations

Tokenization is getting its wings as central banks continue experimenting and opining how it fits into the global financial system. The BOE recently claimed that if tokenized deposits don’t work out, CBDCs are an inevitability. Things are less straightforward in non-unitary systems, as evidenced by the ECB receiving pushback on the digital euro. Despite the ECB calling for expressions of interest in further innovation, member states are suspicious of delegating too much authority to Brussels. 💶

The dollar still reigns supreme, though, and the US Treasury thinks tokenization could be big but needs central control to work effectively. The US is no stranger to central control, with the BIS considering ending the mBridge project as BRICS+ nations use it to skirt global sanctions and expand their DLT payment systems. The BIS recently launched Project Mandala to explore compliant cross-border payments to balance things out. 💲

Further east, Hong Kong issued stablecoin regulations with a big focus on tokenization, and the HKMA has partnered with Thailand and Brazil on tokenized cross-border payments. On the US-compliant side, Visa and PayPal executives are pushing for more stablecoin adoption, and AIIB used Euroclear for $200 million of digitally-native notes. 💴

🔼 It’s an RWA World Out There

Another successful week of tokenization.

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See you next week!