- Chainlink’s Niki Ariyasinghe says that asset tokenization will be the biggest factor behind blockchain adoption and utilization, with major companies moving beyond testing to rollouts.
- He noted that global giants like Citibank, HSBC and Goldman Sachs are leading the tokenization movement, which some reports estimate will hit $10 trillion by 2030.
Blockchain has been utilized in several major fields and applications, from raising money through ICOs to digitizing art through NFTs. However, they all pale in comparison to the impact that the tokenization of real-world assets could have globally, says Chainlink’s Niki Ariyasinghe.
In a recent speech, Niki revealed that Chainlink has been at the forefront of the tokenization wave and has worked with over 40 institutions globally. While the focus used to be on pilot projects and proof of concept, “we’re not shifting to production deployments.
Niki, who is the Head of Business Development for Asia-Pacific and the Middle East at Chainlink Labs, noted that one of the main trends this year will be live transactions.
These are transactions that occur on a blockchain that have real value involved. If you’re issuing a bond, it will be worth a certain amount of dollars of real value rather than testnet transactions.
“We’re shifting to production deployments.”
Having worked with well over 40 institutions globally at @ChainlinkLabs, Niki Ariyasinghe shares his insights on the rapidly evolving landscape for tokenized assets:
1. Leading banks are preparing for the tokenization opportunity… pic.twitter.com/NeIxAxMPOZ
— Chainlink (@chainlink) February 19, 2024
Banks have taken the lead with asset tokenization, Niki added. He singled out Citibank, HSBC and Goldman Sachs as some of the banks pioneering the field. He added that Broadridge, a financial technology company, has also made great strides in the sector.
They believe that this opportunity is coming.
Chainlink Focuses on the $10 Trillion Asset Tokenization Market
While most work on tokenization has been around pilot projects, Niki told the audience that in 2024 and 2025, the world will see more catalyst transactions and “verticals starting to move real volume onto these particular platforms, not just one-off transactions.”
One of the better-known initiatives is Broadridge’s repo platform. The New York company processes over $70 billion worth of transaction value daily, and it’s all built atop blockchain infrastructure, “and this will just replicate itself over a whole range of other different verticals.”
Once you have all those catalysts in place, then we believe that 2026 onwards is the point of acceleration.
According to a report by crypto management firm 21.c0, the tokenization of real-world assets could explode to $10 trillion by 2030.
Tokenization will lead to a convergence between traditional asset classes and crypto, from fiat currencies and government bonds to real estate and equities, the company noted.
“We estimate that the market value for tokenized assets will be between $3.5 trillion in the bear-case scenario and $10 trillion in the bull case by 2030,” it added.
Others like Bank of America have issued similarly bullish predictions for tokenization, with the Boston Consulting Group the most bullish with a prediction of a $16 trillion market.
Meanwhile, Chainlink’s native token, LINK, is trading at $18.28 with minimal price movements over the past day despite a drastic dip in the trading volume. LINK has dipped over 8% in the past week after a sustained rally from mid-January, with the market eyeing a reversal that could push the token to $25.
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