Tokenization of real-world assets could become a $16 trillion industry
The tokenization of real-world assets is estimated to become a $16 trillion industry in the coming years, according to a report by The Boston Consulting Group. The impact of asset tokenization goes beyond financial figures and can provide solutions to real-world problems, especially in developing countries.
Tokenization solutions for agricultural production
During a panel discussion at Swiss Web3 Fest, industry experts highlighted the applications of tokenization in real-world assets. Christoph Mussenbrock, from decentralized insurance protocol Etherisc, spoke about tokenization solutions for agricultural production. He explained that farmers in Kenya can receive insurance payouts immediately after the harvesting season ends, helping to sustain their business even in cases of low yield. This is in contrast to traditional insurance where farmers need to wait for six months to receive a payout.
Traditional insurance companies embrace on-chain solutions
There is a growing demand from traditional insurance companies for on-chain solutions, according to Mussenbrock. He mentioned that traditional insurance companies are increasingly exploring the use of blockchain technology to improve their services.
Asset tokenization for financial inclusion
Stephan Rind, from BrickMark Group, highlighted the potential of asset tokenization to provide access to financial products that are currently unavailable to most people. This can help bridge the gap in wealth distribution by democratizing capital and allowing more participants to invest in traditional financial instruments.
Tokenizing the value creation of a cattle ranch
Carlos Mazzi, from Finka, shared his experience of tokenizing a cattle ranch in Bolivia called La Pradera. The ranch spans 3,000 hectares of grassland and has over 3,500 cows. Mazzi explained that they tokenized the value creation of the ranch, from grass to cash, to enable easier investment and financial transactions. However, market adoption has been slower than anticipated.
Central bank digital currencies and regulation
Stephan Rind believes that the adoption issues of asset tokenization will be overcome with the introduction of central bank digital currencies (CBDCs). He expects that CBDCs will create billions of people with digital wallets, making it easier for them to interact with tokens. Additionally, Rind mentioned that regulatory developments will also play a significant role in unlocking more capital for asset tokenization.
Tokenization as a daily interaction for most people
Jose Fernandez, from Tokengate, predicts that within the next ten years, most people will be interacting with tokens on a daily basis, whether they are aware of it or not. This further emphasizes the potential growth and impact of asset tokenization in various industries.
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