According to Coincu, Singapore and Hong Kong are competing to establish themselves as regional hubs in the tokenization market, which Citigroup forecasts could surge to $5 trillion by 2030. Tokenization encompasses digital representations of tangible assets like bonds, real estate, and private equity, and advocates argue that it enhances liquidity for traditionally illiquid assets, expanding buyer pools and refining price discovery.
Both cities have recently updated guidance to facilitate the tokenization of funds and bonds for retail investors. In February, Hong Kong sold HK$800 million ($102 million) in the inaugural digital green bonds, positioned as the world's first government-issued tokenized green bond, utilizing Goldman Sachs' GS DAP platform. Julia Leung, the CEO of Hong Kong's Securities and Futures Commission, expressed the city's willingness to broaden access to the wider investing public as the crypto landscape evolves gradually.
Meanwhile, Ravi Menon, the head of Singapore's central bank, outlined the nation's intention to establish a stringent regime for cryptocurrency consumer protection while fostering a highly facilitative regulatory environment for tokenization. Menon highlighted ongoing experiments by traditional financial institutions in Singapore, leveraging blockchain and tokenized assets to streamline back-office operations, manage risks more effectively, and enhance the seamlessness of capital-market transactions. The competition between the two jurisdictions is fierce for the potential tokenization opportunity, offering a glimmer of optimism for blockchain enthusiasts amid the challenging crypto landscape of 2022 and the ongoing uncertainties in 2023.
