Circle CEO: Asset tokenization will be more realistic in two-three years


  • MIT Media Lab exec spoke about how tokenization can make liquid assets more accessible without creating new systemic financial risks.
  • The exec also said that blockchain-based tokens would enable the trade of assets like corporate securities on secondary markets.

The CEO of crypto payments company Circle, Jeremy Allaire, believes that asset tokenization will become much more realistic in the next couple of years. Recently, at the World Economic Forum in Davos, Allaire and Neha Narula spoke about how tokenization can make liquid assets more accessible without creating new systemic financial risks. Neha Narula is the director of the Digital Currency Initiative in the MIT Media Lab. 

Both the speakers started out by explaining what blockchain-based tokens are and the purpose of its development. They highlighted that these tokens enable assets like corporate securities and real property to be traded on secondary markets. Narula also spoke about the risks that are associated with these tokens, which require the development of certain standards. 

Narula explained the need for positive regulation as:

We want to have consumer protection, we want to have market integrity. People who are issuing assets should disclose information about what exactly those assets represent. And we want to make sure that those assets are really tied to their representation in the real world.

While discussing the real-world use cases of tokenized assets, Allaire gave an exam of an Indian farmer who might tokenize his future yield and offer it on a global marketplace, where an investor would communicate their interest in the product. Upon asking how far we are from the realization of the idea that a person could securitize his crop yield through tokenization, he responded by saying that it’s a long shot. To bring this idea into action, the above farmer should be able to accept and use a stablecoin. However, according to Allaire, the idea will become more realistic in two to three years.

Allaire said that “the world of capital will look much more like the world that we see in Internet commerce today,” while discussing prospects for the next five to ten years. Narula suggested that during the projected period the industry will see a lot of experimentation, some of which “are going to fail dramatically, but there might be a couple that really and truly do expose something missing from the real world.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

Decentraland price under pressure by market turmoil, MANA points to steep correction

Decentraland (MANA) has not been able to sit back and enjoy its all-time highs printed on Thursday, above $6.0. MANA price reversed to the downside as a wave of negative news surrounding a new Covid variant hit news wires during the Asian session.

More Cryptocurrencies News

Bitcoin, Ethereum, XRP at discount ahead of Black Friday while investors fear new COVID strain

Over $265 billion wiped off the overall crypto market capitalization in a bloodbath as news of the new Covid strain breaks out. Bitcoin, Ethereum and Ripple prices have tumbled over 6%, and the top 10 cryptocurrencies are trading at a steep discount.

More Bitcoin News

XRP holds key support while indicators point to short-term recovery

Ripple started a recovery wave above a key support level of $1.024. XRP price started an upside correction as indicators suggest a short-term recovery. The coin may initiate a fresh downtrend upon a breakout of the $1.024 support level.

More Ripple News

Dogecoin-killer Shiba Inu hits 1 million holders, gets listed on South Korean exchange

Shiba Inu hit an important milestone of 1 million holders with a rise in the number of investors. The memecoin listed on a South Korean crypto exchange successfully despite strict regulatory requirements. 

More Shiba Inu News

Black Friday 2021 Discounts!

Do you want to take your trading skills to the next level? Now you have a chance of leaping forward at attractive introductory rates. For Black Friday, FXStreet is offering discounts of up to 50% on its upgraded Premium plans. 

Subscribe now!

BTC

ETH

XRP