JPMorgan's report reveals that real asset tokenization falls short of expectations, with a market value of only $25 billion.
The sector is heavily funded by companies specializing in digital currencies, with little interest from traditional financial institutions (TradFi).
Despite the hype, JPMorgan and other analysts question the viability of real asset tokenization, citing limited participation from major banks and financial institutions.
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JPMorgan Report Reveals the Grim Truth About Real Asset Tokenization (RWA)
According to a report from JPMorgan, the real asset tokenization sector falls short of expectations. Its total market value is $25 billion, which is roughly equivalent to the weekly flows of U.S. exchange-traded funds.
Moreover, the vast majority of current investments come from companies specializing in digital currencies. Traditional financial institutions are not joining this trend, and their interest may already be waning.
Is real asset tokenization facing failure?
Real asset tokenization is often regarded as one of the most promising sectors in the digital currency market, showing strong performance while withstanding broader economic downturns.
Venture capital firms in digital currencies show significant interest, and major governments are exploring its applications. But what if this hype is overstated? A bold report from JPMorgan claims that:
Nikolaos Panigirtzoglou, a strategist at JPMorgan, claimed that "the overall base of tokenized assets remains insignificant. This disappointing picture of tokenization reflects traditional investors' lack of vision for its necessity so far. There is also no substantial evidence yet of banks or clients transitioning from traditional bank deposits to tokenized deposits on the blockchain." $BTC