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⚡ IMF Overloaded By Digital Assets?

RWA World Newsletter - June 21, 2024

Author

Ray Buckton
June 21, 2024

Tokenization is changing the face of the financial landscape day by day. 🎭

While the IMF feels overwhelmed by the workload, Coinbase is striving to be your primary financial account. ☯️

🎯🔥 Rapid Fire Takeaways:

But the real winners of tokenization are the young, with companies like The Hashgraph Association funding Web3 education for 3000 students across Africa. 🌍

Is it any surprise that young people prefer digital assets by a wide margin compared to their seniors? 👀

🗣️ Join the RWA World! 

We’re some busy bees at RWA World! 🐝

The awesome folks at the XDC Foundation recently featured us on their podcast! It’s worth a listen. 🔊

We’re also running the gauntlet on X – join us for some of these educational and enlightening conversations! 

⚖️ Regulation and Policy

The compliance landscape continues to evolve, with no shortage of drama from the U.S. SEC, which dropped its investigation into Ethereum-aligned giant Consensys this week! This development suggests the SEC does not view Ethereum 2.0 as a security, opening the door for other proof-of-stake networks to argue that their networks are also sufficiently decentralized. 🌐

It might also be a question of willingness and resources. David Hershe, who led the SEC’s crypto assets and cyber unit for two years, has officially announced his departure from the agency. With an Ether EFT on the books for July 2nd, is Gensler’s war on digital assets finally crumbling? 🗑️

Source: Broadridge

If so, it’s great timing. The BIS recently launched the Toronto Innovation Center with the Bank of Canada. At the same time, the International Securities Services Association’s (ISSA) recent survey shows that DLT is becoming increasingly important to firms. Some highlights: 

  • 80% of respondents see DLT as enabling innovation 💡

  • 75% are currently struggling with digital assets 😖

  • 8% of projects have >$500 million in annual turnover 💪

  • 68% of projects have <$10 million in annual turnover 🤏

🌐 Tokenization Activity 

RWA World officially helped break some news! Our friends at Provenance Blockchain recently collaborated with Infineo to mint $9 million of on-chain insurance policies. 🎉

Other tokenization categories are also making stark progress, with Tether launching a new tokenized gold-backed dollar, aUSD₮, to diversify the stablecoin landscape. Meanwhile, Ripple is working with Archax to expand its RWA ecosystem, building on its partnership with Zoniqx, a turnkey tokenization interface. 🌊

According to a recent survey by Kaiko Analytics, TradFi continues to dominate the tokenization game. Blackrock’s BUIDL boasts around $460 million in holdings, while Maple sports $16 million, a mere 3.47% the size of Blackrock’s fund. With this backdrop, it’s little wonder why Marui, a Japanese retailer, tapped TradFi-aligned Securitize to help issue its digital green bond. 🏛️

🏢 Institutions and Investments

Marui isn’t the only Japanese entity interested in tokenization. Nomura’s Laser Digital secured its second crypto brokerage license from the UAE, and the Big Three banks of Japan (MUFG, SMBC, and Mizuho) are collaborating on digital identity solutions. Turkey is also in play, with Garanti BBVA officially exploring crypto services for its 12 million customers. Worldwide, tokenization is making inroads. 🛣️

The who of tokenization is as important as the where. A recent Bank of America survey shows that while the 44+ age group prefers respective allocations of 1% to crypto and 5% to alternatives, these figures explode to 14% and 17% for the 21-43 age group. The biggest gap was in sentimental value – the 44+ age group saw 26% of respondents valuing sentiment, while the 21-43 age group clocked in at 86%! 📊

This significant gap helps explain why institutions are starting to make moves. While they’re only a decade behind Fidelity, which has been mining Bitcoin since 2015, Deutsche Telekom, the largest telecom provider in Europe, is following suit with its own mining operation. With NAB Ventures making an investment in Zodia Custody and Citi unveiling their digital asset platform CIDAP, the party is just getting started. 🥳

🔌 CBDCs and Interoperability

Of course, central banks won’t let the private sector move alone. In conjunction with the BIS, the English and European Central Banks have announced that Project Meridian FX will homogenize their DLT systems for foreign exchange. The Swiss Central Bank has extended its CBDC trial with Six Digital Exchange by an additional two years. 🕜

Source: BIS

More than ever, central banks are keen to explore CBDC solutions. A recent BIS study of 86 banks revealed that 94% are working on digital versions of national currencies, aiming for a wholesale CBDC within six years. Korea is one such participant, having just announced a digital certificate program for its CBDC. 💻

🏠 Taking it Home 

Another powerful week for asset tokenization. 💥

From data-driven adoption metrics to central banks and institutions taking advantage of new technologies, we’re seeing a renaissance in digital technology adoption. 🤖

Make sure to join us throughout the week as we speak live with asset issuers, founders, and builders, discussing the state of the industry and analyzing the real-time developments as they unfold! 📰👋