Stablecoin Market and Potential of RWA in Cryptocurrency Industry
Many banks and financial institutions are preparing to enter the newly regulated stablecoin cryptocurrency market. However, Standard Chartered (STAN) is focusing on the $23 billion non-stablecoin real world asset (RWA) market. The bank expects this number to grow significantly.
According to STAN, while stablecoins dominate the tokenization of real-world assets, the bank sees signs of a broader shift in the sector. However, non-stablecoin RWAs account for only 10% of the stablecoin market.
The Growth Potential of RWA Tokenization in Sectors Like Private Equity and Off-Chain Commodities
In the research report, STAN highlights the growth potential of this market due to improved regulatory clarity and a shift towards assets with clearer benefits when put on-chain.
“To fully exploit the growth potential, we believe tokenization efforts should focus on on-chain assets that are lower cost or more liquid than traditional forms, or address off-chain needs,” said Geoff Kendrick, head of digital asset research at Standard Chartered.
Cryptocurrency tokenization of private loans has shown potential with faster settlement costs and reduced service fees, while projects to tokenize liquid assets such as gold or US stocks have not achieved positive results due to limited clear chain benefits.
The bank predicts that private equity and off-chain commodities will be new growth areas for RWA tokenization.
Challenges and Potential of Tokenizing Real-World Assets
Tokenizing RWAs, especially those based on real estate or collectibles, is not yet fully automated, said Alan Konevsky, executive vice president of TZero.
“Financial instruments, especially if tokenized, can be fully automated,” he said. In addition, tokenizing physical assets requires cooperation from traditional market players.
Tokenization is becoming one of the main applications of blockchain technology, attracting attention and investment from the traditional world. Meanwhile, stablecoins are popular in international money transfers.
The number of RWAs has grown by 260% this year, according to figures. However, business leaders remain skeptical about the size of the market, saying it is still too new and small.
Meanwhile, BlackRock, JPMorgan, and Goldman Sachs have begun testing tokenized funds. Governments like Singapore and Hong Kong are creating clear, RWA-friendly regulations. DeFi is also integrating RWAs to provide stable, practice-based yields.
According to Boston Consulting Group (BCG) prediction, the RWA Tokenization market will reach 18.9 trillion USD by 2033, an average annual growth rate of about 53% CAGR.
Regulatory Challenges and KYC Requirements in the RWA Market
Lack of clarity on KYC regulations remains a major barrier, STAN said. While Singapore, Switzerland, the EU and Jersey have made progress on regulations, the lack of uniformity in KYC standards remains a major challenge.
The policies of these regions show that the focus needs to be on assets that truly add value when tokenized. The UAE and other countries are also actively improving this legal framework.
Jersey is considering developing a “Know Your Customer” information-sharing tool to simplify the identity verification process, while the EU is looking to improve anti-money laundering, establishing new supervisory bodies such as AMLA.
Source: https://tintucbitcoin.com/standard-chartered-mo-rong-token-on-dinh/
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