Building Tokenization Insight | GTM Research & Content | Follow to learn. DM to partner | I write about tokenization adoption trends & help tokenization projects avoid pitfalls
Tokenized cash will be the first tokenization product to reach MASS adoption status, defined as >$1 trillion market cap. Here is why ⬇ 1️⃣ Demand is growing. From start of 2024 to today, the total market cap for tokenized cash on public blockchain grew 25%+ to $164 billion. The only use case for tokenized cash used to be store of value onchain and payment. This by itself is running at $10 trillion a year. With the launch of various asset management products such as tokenized MMF and tokenized basis trading, onchain capital will have direct access to many of the traditional investment management products and more. Coupled with better efficiency, cash will increasingly likely to stay onchain, instead of being off-ramped. 2️⃣ Demand is global. On the US side: State Street was exploring launching its own tokenized cash product last week following J.P. Morgan and PayPal in the US. On the other side of the globe, regulators and firms have been actively engaging in stablecoin pilots and policy framework, including: - Standard Chartered HK and Hong Kong Telecom are exploring stablecoin issuance - JD.COM's HK Coinlink subsidiary is also exploring the idea. 3️⃣ The regulatory environment is being updated to pave the way for regulatorily compliant mass issuance. Hong Kong Monetary Authority (HKMA) recently published a legislative proposal outlining stablecoin regulation covering: - Capital requirement - Licensing requirement per investor distribution type - Reserve asset eligibility - Audit and reporting requirement - Interest ban - Redemption process McKinsey & Company says tokenized cash is the first tokenization product to reach meaningful adoption, defined as >$100 billion market capitalization. I believe tokenized cash will be the first mass-adopted tokenization product. Tokenized investment products with deep existing liquidity such as MMF will follow. Do you agree? Leave your comments below. ⬇ I write about tokenization and digital asset management. If you want to stay up to date with trends and opportunities, you can: ✅Follow me and repost ✅Join 4,000+ readers at The Crypto Adoption Curve newsletter https://lnkd.in/em5V4k-v ✅Save 40 hrs a week & get exclusive insights by Subscribing at https://lnkd.in/gTxp8uWM #digitalassets #tokenization #financialservices
Florent Thorne
3mo
I have a contrarian view ;-) Tokenized cash & stablecoin should decrease as share of portfolio as they are reduced to value transfer and pricing tool. With the developpment of risk-free on-chain yield bearing assets (ex. government debt, central bank deposits) digital cash will loose its usefullness as store of value. Similarily to how money on bank account tends to move to better options with better UX (and non-zero rates). Most banks have developped services for automatically move money from sight to/from saving accounts. Smart contracts will increase efficiency of those (include the arbitrage in the same transaction) Like with commercial bank money some time ago, all tokenized cash won't be created equal. The better the integration with saving services, the shorter life of the tokenised cash and the better the adoption. Why not directly use tokenized saving/MMF as money? I see a few issues: - depending on country, financial situation, etc. one prefer different saving products - fiscal evaluation prefers trades to be against cash (measure of value) - coupons are separated from the payment settlement
Darien Cook
3mo
Who's the majority of utilities that's part of it? XLM, XRP, XDC, SUI, HBAR? At some point, I'm sure all those and several others will be worth unseen numbers.
Wenny Ow
3mo
What’s the difference between between tokenised cash and digital cash we have today?
Building Tokenization Insight | GTM Research & Content | Follow to learn. DM to partner | I write about tokenization adoption trends & help tokenization projects avoid pitfalls
3moTrue or False. The regulatory environment is changing the fastest for tokenized cash vs other tokenized assets because of its significant adoption impact.