Tokenization to Account for 5-10% of Global Assets by 2030

02/25/2023 22:06 • AI Insights • 97 views

It is reported that in a recent report, HSBC and Northern Trust predicted that by 2030, 5% – 10% of all assets will be tokenized. According to McKinsey’s data, the total assets under management in 2021 will reach 126 trillion US dollars, while BCG’s figure is 112 trillion US dollars. Using McKinsey’s figures and a compound growth rate of 5%, the AUM will be about 195 trillion US dollars by 2030, with tokenization accounting for 5% to 10% of this figure.

HSBC: 5-10% of assets will be tokenized by 2030

Analysis based on this information:

As digital technology continues to evolve, the global finance industry has seen a significant shift towards more efficient asset management strategies. The latest report from HSBC and Northern Trust predicts that by 2030, 5% – 10% of all assets will be tokenized, leading to increased efficiency, transparency, and liquidity in the asset management industry.

Tokenization refers to the process of creating digital tokens that are backed by physical assets like stocks, real estate, art, or any other valuable physical asset. These tokens can then be traded, tracked, and stored on a blockchain network, making the process of managing and investing in assets streamlined and more accessible.

According to McKinsey’s research, global assets under management will reach 126 trillion US dollars in 2021, a figure projected to grow to around 195 trillion US dollars by 2030 at a compound growth rate of 5%. The report notes that tokenization of assets could account for 5% to 10% of this increase, representing a significant shift in the asset management industry.

The benefits of tokenization include increased liquidity, reduced counter-party risks, and lower transaction costs, making digital assets a more attractive investment option for both individual investors and institutional investors. Tokenization also provides increased transparency, making it easier to track the ownership and history of an asset, which is useful in the case of high-value assets like art, real estate or precious metals.

The adoption of blockchain technology and tokenization not only streamlines asset management processes but also opens up opportunities for new asset classes. Tokenization allows for fractional ownership of illiquid assets, giving smaller investors the ability to pool resources and gain exposure to assets that were previously out of their reach.

In conclusion, the trend towards tokenization of assets is set to revolutionize the asset management industry, increasing liquidity, efficiency, and transparency. By 2030, tokenization is predicted to account for 5% to 10% of all assets, marking a significant shift in the way assets are managed and invested in.

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Tokenization to Account for 5-10% of Global Assets by 2030

HSBC: 5-10% of assets will be tokenized by 2030

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