Tokenized RWAs: McKinsey Forecasts $2 Trillion by 2030, Adoption Lags Behind
According to a recent report by global consulting firm McKinsey & Company, the adoption of tokenization is expected to happen in waves, with assets such as mutual funds, bonds, and loans leading the way. Despite the potential benefits of tokenizing real-world assets (RWAs), many financial institutions are still hesitant and are in a “wait and see” mode.
While some early movers in the industry have already started exploring tokenization, there is still a long way to go before broad adoption becomes a reality. The McKinsey report suggests that the market for tokenized assets may only reach $1 trillion by 2030, significantly lower than more optimistic projections by other firms.
The trend of tokenization has gained momentum in recent years, with major players in the financial industry, including BlackRock and Citigroup, exploring the potential of blockchain technology for traditional financial instruments. By tokenizing assets like U.S. Treasuries and commodities, these institutions hope to achieve operational efficiencies and greater accessibility.
In its base case scenario, McKinsey estimates that the tokenized asset market could reach $2 trillion by 2030, excluding certain types of assets like stablecoins and central bank digital currencies from the calculation. However, a more optimistic scenario of $4 trillion could be possible with the right regulatory environment and industry collaboration.
The report highlights that assets such as mutual funds, bonds, and loans are likely to see faster adoption compared to real estate, commodities, and equities. This is due to various factors such as regulatory concerns, compliance requirements, and the complexity of tokenizing certain assets.
Despite the challenges associated with integrating blockchain technology into existing processes, many institutions recognize the importance of tokenization for the future of finance. Early adopters who are able to navigate these challenges could potentially gain a significant market advantage in the long run.
Overall, the road to widespread adoption of tokenized assets is still a work in progress. As more projects transition from pilot to deployment at scale, the industry is likely to see a gradual shift towards embracing tokenization as a key aspect of financial services in the years to come.