Asset Tokenization to Expand into $16.1M Business Opportunity by 2030: BCG, ADDX Report

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Asset tokenization will expand into a US$16.1 million business opportunity by 2030, according to a joint report published by BCG and ADDX.

The report suggested that the growth forecast was made by studying the potential of the crypto winter as it has been prompting capital to focus on more viable blockchain use cases.

According to the BCG and ADDX report — titled «Relevance of on-chain asset tokenization in ‘crypto winter’» — the drive behind the projected growth in tokenization of assets is also due to demand from a wide range of investors for more access to private markets.

Asset tokenization refers to the creation of tokens on a blockchain to represent an asset in order to facilitate more efficient transactions. The tokenization and fractionalization of assets lower barriers to investment in private markets by reducing minimum lot sizes.

The report indicated that «assets being fractionalized and tokenized on platforms such as ADDX can reduce minimum investment sizes from millions of dollars to just thousands of dollars.»

«Previously, investments of this kind were only available to institutions. Tokenized investments can also be effectively ‘borderless’, allowing investors around the world to invest in markets they were previously unable to access,» it added.

Backtracking to previous years, assets globally were also held in illiquid formats, and past studies have estimated that the share of illiquid assets was at more than 50% of overall assets.

In comparison to asset tokenization, illiquid assets face challenges such as imperfect price discovery and trading discounts compared to liquid assets, according to the BCG and ADDX report. However, tokenization is simple as it creates liquidity by making it easier for the