tl;dr
Standard Chartered forecasts significant growth in tokenizing real-world assets (RWAs) beyond stablecoins over the next five years, driven by regulatory progress and focus on high-impact use cases. While stablecoins currently dominate blockchain-based RWAs, tokenization of assets like private credit...
Standard Chartered forecasts a significant surge in the tokenization of real-world assets (RWAs) beyond stablecoins over the next five years, driven by advancements in regulatory clarity and a targeted focus on impactful use cases. Currently, stablecoins dominate blockchain-based RWAs, but tokenization efforts for assets such as private credit, securitized debt, private equity, and commodities have remained limited due to regulatory disparities and an initial concentration on low-value sectors.
The bank's report highlights tokenized private credit as an early standout success, showcasing blockchain’s ability to enhance liquidity in markets traditionally characterized by illiquidity. This precedent paves the way for similar growth in private equity and niche commodities, where institutional investors are eager for improved efficiency and transparency.
However, regulatory fragmentation continues to pose challenges, although progress in regions like Singapore, Switzerland, the EU, and Jersey offers a more positive regulatory landscape. Know-your-customer (KYC) requirements further complicate cross-border integration. Standard Chartered advises industry participants to focus on areas where tokenization provides distinct advantages over conventional assets, rather than merely duplicating traditional market functionalities.
Looking ahead, the report projects steady expansion in tokenized private credit, structured debt, and corporate bonds, with accelerated growth expected from 2025 onward. By adopting lessons from early private credit initiatives and reinforcing compliance frameworks, non-stablecoin RWAs are poised to become a transformative force within the digital asset ecosystem.