The Tokenized Asset Coalition (TAC), a membership organization that promotes the institutional adoption of tokenization practices to bring real-world assets to the blockchain, has published its State of Tokenization report. The report highlights the growth and advancements in tokenization practices in 2023 and predicts further growth in 2024.
Growth in Tokenization
The State of Tokenization report by TAC predicts the advancement of tokenization practices across various asset classes in 2024. The emergence of a new tokenized risk curve is described, with different asset classes gaining prominence in blockchain markets.
The report focuses on the tokenization of currencies, highlighting the domination of U.S. dollar-based stablecoins and centralized stablecoins over their decentralized counterparts. However, the report predicts that euro-pegged tokens and alternative stablecoins will witness a surge in adoption in 2024.
Tokenization of U.S. Treasuries
The tokenization of U.S. treasuries experienced significant growth in 2023, with a total value increase from $114 million in January to $831 million in December. This represents a growth of over 600%. Franklin Templeton and Ondo Finance were the key players in offering products in this space.
Growth in Private Credit Platforms
Private credit platforms also saw a surge in total value in 2023, with an 89% increase from $256 million to $485 million. This growth indicates the growing interest in tokenized private credit.
Boom in Digital Tokenized Bonds
2023 witnessed a boom in digital tokenized bond experiments, with various organizations announcing bond issuance projects. Traditional financial institutions led these initiatives, and digital platforms supporting such activities experienced growth in Asia and Europe.
Predictions for 2024
Despite regulatory uncertainties, liquidity concerns, and infrastructure challenges, the report predicts that tokenization will continue to grow in 2024. Stablecoins, private credit, tokenized treasuries, and digital bonds will evolve further, contributing to the overall adoption of tokenized asset markets.
Jeremy Allaire, CEO of Circle, the stablecoin company behind USDC, recently expressed his belief in the booming adoption of tokenization. He expects institutions like Blackrock to offer tokenized versions of their products in 2024.
What are your thoughts on TAC's "State of Tokenization" report? Let us know in the comments section below.
Frequently Asked Questions
How Does Gold Perform as an Investment?
Supply and demand determine the gold price. Interest rates can also affect the gold price.
Due to the limited supply of gold, prices for gold are highly volatile. In addition, there is a risk associated with owning physical gold because you have to store it somewhere.
How much of your portfolio should be in precious metals?
This question can only be answered if we first know what precious metals are. Precious elements are those elements which have a high price relative to other commodities. This makes them extremely valuable for trading and investing. The most traded precious metal is gold.
There are however many other types, including silver, and platinum. While gold's price fluctuates during economic turmoil, it tends to remain relatively stable. It is also relatively unaffected both by inflation and deflation.
The general trend is for precious metals to increase in price with the overall market. However, the prices of precious metals do not always move in sync with one another. The price of gold tends to rise when the economy is not doing well, but the prices of the other precious metals tends downwards. This is because investors expect lower interest rates, making bonds less attractive investments.
When the economy is healthy, however, the opposite effect occurs. Investors favor safe assets like Treasury Bonds, and less precious metals. They are more rare, so they become more expensive and less valuable.
Diversifying across precious metals is a great way to maximize your investment returns. Because precious metals prices are subject to fluctuations, it is best to invest across multiple precious metal types, rather than focusing on one.
Can I have physical gold in my IRA
Gold is money and not just paper currency. Gold is an asset people have used for thousands years as a place to store value and protect their wealth from economic uncertainty and inflation. Investors use gold today as part of their diversified portfolio, because it tends to perform better in times of financial turmoil.
Many Americans are now more inclined to invest in precious metals like gold and silver than stocks or bonds. It is possible to make money by investing in gold. However, it doesn't guarantee that you'll make a lot of money.
Another reason is that gold has historically outperformed other assets in financial panic periods. Gold prices rose nearly 100 percent between August 2011 and early 2013, while the S&P 500 fell 21 percent over the same period. Gold was one asset that outperformed stocks in turbulent market conditions.
Another benefit to investing in gold? It has virtually zero counterparty exposure. Your stock portfolio can fall, but you will still own your shares. Gold can be worth more than its investment in a company that defaults on its obligations.
Finally, gold is liquid. This means that, unlike most other investments, you can sell your gold anytime without worrying about finding another buyer. Gold is liquid and therefore it makes sense to purchase small amounts. This allows one to take advantage short-term fluctuations within the gold price.
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
- Saddam Hussein’s InvasionHelped Uncage a Bear In 1989 – WSJ
- Want to Keep Gold in Your IRA at Home? It's Not Exactly Legal – WSJ
Investing with gold or stocks
This might make it seem very risky to invest gold as an investment tool. The reason behind this is that many people believe that gold is no longer profitable to invest in. This belief arises because most people believe that the global economy is driving down gold prices. They feel that gold investment would cause them to lose money. In reality, however, there are still significant benefits that you can get when investing in gold. Let's take a look at some of the benefits.
Gold is the oldest known form of currency. There are thousands of records that show gold was used over the years. It was used by many people around the globe as a currency store. It is still used as a payment method by South Africa and other countries.
You must first decide how much you are willing and able to pay per gram to decide whether or not gold should be your investment. If you're interested in buying gold bullion, it is crucial that you decide how much per gram. If you don’t know the current market rate for gold bullion, you can always consult a local jeweler to get their opinion.
It is important to remember that even though gold prices have dropped in recent times, the cost of making gold has risen. Although gold's price has fallen, its production costs have not.
You should also consider the amount of your intended purchase when considering whether you should buy or not. If you plan to buy enough gold to cover your wedding rings then it is probably a good idea to wait before buying any more. It is worth considering if you intend to use it for long-term investment. You can profit if you sell your gold at a higher price than you bought it.
We hope this article has given you an improved understanding of gold investment tools. It is important to research all options before you make any decision. Only after you have done this can you make an informed choice.
By: Sergio Goschenko
Title: The Tokenized Asset Coalition Predicts Tokenization Advances in 2024
Sourced From: news.bitcoin.com/tokenized-asset-coalition-expects-tokenization-to-grow-in-2024/
Published Date: Sat, 20 Jan 2024 05:30:36 +0000