- CoinGecko’s analysis of asset tokenisation in 2023 revealed some positive signs for the sector moving forward.
- In particular, the report discovered that commodities (such as precious metals) were being represented more and more by cryptocurrency, hitting an all-time high in market cap.
- Additionally, tokenised treasury products grew more than 600% through 2023-24, with yield-bearing assets from Franklin Templeton particularly popular.
Real-world asset tokenisation has long been regarded as the next frontier of the crypto industry. The potential of such technology has already been harnessed by several big players (such as ANZ and real estate companies), but many believe widespread adoption is still a little away. However, according to a 2024 report from CoinGecko, this reality may be much closer than we think.
Related: AVAX Soars as ANZ Bank, Chainlink and Avalanche Explore New DeFi Frontiers
What Did CoinGecko’s Report Reveal?
CoinGecko’s report unveiled some interesting surprises – and some not quite so surprising. As everyone likely expected, the analysis showed that approximately 99% of DeFi stablecoin activity was performed by US-backed stablecoins like Tether and USDC.
The market cap of these assets is still a little behind its 2021 peak, suggesting that while Bitcoin has surged in interest and price, a true DeFi bull market is lagging a little.
On the flipside, commodity-backed tokens have reached new heights, with a particular spike in precious metal-based assets pushing the market cap over USD $1B. Crypto has long made sense as an arbiter of gold and silver, as storing large amounts of these commodities is often unrealistic without an expensive middle-man.
Other takeaways included:
- Tokenised treasury products grew 641% in 2023 to be valued at over USD $861M (AUD $1.3B). The biggest issuer of such assets, Franklin Templeton, uses the Stellar blockchain.
- Nearly 40% of private credit represented on the blockchain belongs to the automotive sector. Fintech (19%) and real estate (9%) round out the top three.
What Are Real-World Assets?
Real-world assets (RWAs) are digital tokens that are backed by an underlying, “real-world” value. The most prominent examples within the crypto industry are stablecoins like Tether, which typically represent USD or another fiat currency. Although this form of RWAs still dominates the DeFi market – and is slowly seeping into TradFi too – the potential of tokenisation stretches far beyond what already exists.
Related: Bloomberg Analyst Predicts Spot Ethereum ETF Rejection in May
Non-fungible RWAs have become a hot topic due to the benefits they pose. Many have theorised that expensive, difficult-to-transact assets such as valuable art or property can become much more efficient if handled by the blockchain. Not only does it make fractionalisation a reality, RWAs support faster and cheaper settlement times, on top of better proof of ownership.
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