Asset Tokenization Market Size
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 1.43 Trillion |
| Market Size (2029) | USD 9.37 Trillion |
| CAGR (2024 - 2029) | 45.46 % |
| Fastest Growing Market | Asia Pacific |
| Largest Market | North America |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Asset Tokenization Market Analysis
The Asset Tokenization Market size is estimated at USD 1.43 trillion in 2024, and is expected to reach USD 9.37 trillion by 2029, at a CAGR of 45.46% during the forecast period (2024-2029).
- Asset tokenization is swiftly reshaping the financial landscape, harnessing blockchain technology to transform real-world assets into digital tokens. This breakthrough not only boosts liquidity and accessibility but also democratizes investment opportunities across diverse sectors.
- Recognizing the potential of asset tokenization to streamline operations and boost efficiency, major financial institutions are diving deeper into this realm. Notably, industry giants like BlackRock and Goldman Sachs are at the forefront, actively crafting tokenized products.
- As of December 2023, real estate and equities dominate the landscape of tokenized assets. Out of 80 organizations surveyed, 56 have established their own tokenized asset marketplaces, facilitating the fractionalization of tangible assets.
- Tokenization paves the way for fractional ownership of premium assets, be it real estate or art. This democratization means a wider array of investors can now partake. Such accessibility not only boosts liquidity but also allows smaller stakes in markets traditionally deemed illiquid. Moreover, as the momentum for asset tokenization builds, we anticipate clearer regulatory frameworks to emerge. This clarity is vital, not just for bolstering investor confidence, but also for enticing institutional players into the tokenized arena.
- According to Forbes, the costs associated with asset tokenization hover between USD 100,000 to a staggering USD 300,000 and beyond. However, with the global embrace of tokenization, companies stand to save a whopping USD 20 billion annually on clearing and settlement costs. Looking ahead, projections suggest that by 2030, tokenization could unlock a staggering USD 16 trillion of previously illiquid assets.
- Yet, despite the evident benefits, the market's embrace of asset tokenization remains challenging. A significant hurdle is the skepticism many traditional investors harbor towards blockchain technology and digital assets. This skepticism can stifle trust and hinder broader acceptance. Thus, fostering confidence among these investors becomes paramount for wider market engagement.
- The COVID-19 pandemic has accelerated the shift towards asset tokenization, altering perceptions, management, and trading of assets. In the face of pandemic-induced challenges, organizations and investors are turning to asset tokenization as a beacon for improved liquidity, accessibility, and market efficiency.
- In the wake of the pandemic, blockchain technology has witnessed notable strides, especially in security protocols and scalability solutions like Layer 2 technologies. Such advancements are pivotal, ensuring the system can handle the surge in transaction volumes that widespread asset tokenization will inevitably bring.
Asset Tokenization Market Trends
Real Estate to Hold Significant Share
- Tokenized real estate refers to the representation of a real estate property or its cash flows as blockchain tokens. This approach aims to enhance liquidity, streamline processes, and facilitate digital ownership. In essence, tokenization involves dividing a real estate property into fractions and automating its operational processes through smart contracts. The process begins with the property owner deciding how to segment the property's value. Subsequently, these fractional tokens allow for incremental purchases, whether by multiple investors or a single entity.
- Tokenizing real estate democratizes access, allowing smaller investors to participate, which in turn boosts demand across the board. Moreover, the hallmark benefits of blockchain technology—security and transparency—are integral to real estate tokenization. Every transaction, from sales to ownership transfers, is recorded on-chain, ensuring accessibility and resistance to tampering, thus fostering trust.
- In the U.S., the real estate tokenization market is evolving, particularly within the multifamily sector. For instance, a 250-unit multifamily apartment complex in Dallas, which recently adopted tokenized investment options, successfully raised USD 6.5 million from investors for its USD 47 million project. The project's owner highlighted benefits like streamlined paperwork, automated processes, and improved liquidity via secondary market trading.
- Moreover, several marketplaces dedicated to tokenized real estate assets have surfaced, such as RealT, Vesta Equity, Vave, LEX Markets, and DigiShares. These platforms are not only facilitating the exchange of tokenized assets but are also playing a pivotal role in promoting this novel investment strategy.
- Experts predict that blockchain platforms will transform numerous facets of real estate, spanning smart contracts, due diligence, property management, and leasing. Mark Ventre of Stepp Commercial underscores the diverse potential of blockchain in real estate, envisioning it as a secure digital archive for transaction histories, title documents, permits, and beyond.
North America is Expected to Hold a Major Share of the Market
- In North America, asset tokenization is gaining momentum, propelled by advancements in blockchain technology and a growing acknowledgment of its potential to boost liquidity and democratize investment access.
- According to industry experts, as of late 2024, tokenized funds have amassed over USD 2 billion in assets under management (AUM). Projections indicate that AUM could soar to over USD 600 billion by 2030, assuming tokenized funds capture a mere 1% of the global mutual fund and ETF AUM.
- Major financial players, including JP Morgan, BlackRock, and Goldman Sachs, are delving into tokenization initiatives across the region. Notably, JP Morgan's Onyx division is pioneering infrastructure for digital asset transactions, achieving a milestone with tokenized money market funds exceeding USD 1 billion in total value by Q1 2024.
- Recent regulatory advancements in the U.S. have catalyzed financial product innovations. A testament to this is the Arca US Treasury Fund, the nation's inaugural registered closed-ended fund, which has begun issuing shares as digital asset securities via blockchain technology.
- In the U.S., blockchain technology is bolstering asset tokenization endeavors, notably in real estate. Platforms like CoinList and Coinbase are paving the way for further tokenized asset developments across the nation.
- Meanwhile, in Canada, the Canadian Securities Exchange's introduction of a blockchain clearing house is set to fuel the growth of asset tokenization, particularly for traditional assets.
Asset Tokenization Industry Overview
The Asset Tokenization market is highly competitive and fragmented, primarily driven by the presence of major players. These key players employ strategies such as mergers, acquisitions, and product innovations to maintain a competitive edge and broaden their global footprint. Key player include Securitize Markets, LLC, tZERO Technologies, and others.
The trends in asset tokenization highlight a transformative shift in how assets are perceived and managed within financial markets. With significant growth potential, increasing institutional interest, enhanced liquidity options, evolving regulatory landscapes, and diverse applications across asset classes, the future of asset tokenization appears promising. As technology continues to mature and regulatory frameworks solidify, one can expect broader adoption and integration of tokenized assets into mainstream finance.
Asset Tokenization Market Leaders
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Securitize Markets, LLC
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tZERO Technologies
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SoluLab Inc.
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Blocktunix Inc.
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Block Gemini Inc.
*Disclaimer: Major Players sorted in no particular order
Asset Tokenization Market News
- November 2024: Investment bank UBS launched its first tokenized investment fund, a money market fund on the Ethereum blockchain. UBS joins BlackRock and Franklin Templeton in exploring the tokenization of real-world assets by offering such funds.
- June 2024: Investcorp, a global asset manager, announced a partnership between its Strategic Capital Group (ISCG) and Securitize, a firm specializing in asset tokenization. The tokenized fund will provide qualified investors with exposure to ISCG’s general partner staking strategy, a method of private equity investment that invests in asset management firms directly by acquiring minority interests in those firms rather than investing in the underlying funds those firms manage.
Asset Tokenization Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Attractiveness - Porter's Five Forces Analysis
4.2.1 Bargaining Power of Suppliers
4.2.2 Bargaining Power of Consumers
4.2.3 Threat of New Entrants
4.2.4 Threat of Substitute Products
4.2.5 Intensity of Competitive Rivalry
4.3 Industry Value Chain Analysis
4.4 Assessment of Impact of macroeconomic trends
5. MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Rising Demand for Cloud Based Tokenization
5.1.2 Inclination Towards Contactless Payments
5.2 Market Restraints
5.2.1 Lack of Skilled Workforce and Poor Management
6. MARKET SEGMENTATION
6.1 By Asset Type
6.1.1 Real Estate
6.1.2 Debt
6.1.3 Investment Funds
6.1.4 Private Equity
6.1.5 Public Equity
6.1.6 Other Types
6.2 By End-user Vertical
6.2.1 Institutional Investors
6.2.2 Retail Investors
6.3 By Geography***
6.3.1 North America
6.3.2 Europe
6.3.3 Asia
6.3.4 Australia and New Zealand
6.3.5 Latin America
6.3.6 Middle East and Africa
7. COMPETITIVE LANDSCAPE
7.1 Company Profiles
7.1.1 Securitize Markets, LLC
7.1.2 tZERO Technologies
7.1.3 SoluLab Inc.
7.1.4 Blocktunix Inc.
7.1.5 Block Gemini Inc.
7.1.6 Polymath Research Inc.
7.1.7 Chainlink Foundation
7.1.8 Tokensoft Inc.
7.1.9 Brickken Solutions SL
7.1.10 Polymath Research Inc.
- *List Not Exhaustive
8. INVESTMENT ANALYSIS
9. FUTURE OUTLOOK OF THE MARKET
Asset Tokenization Industry Segmentation
Asset tokenization is the process of converting the value of a tangible or intangible asset into a digital token using blockchain technology. This transformation allows for fractional ownership, increased liquidity, clear traceability and auditability.
The asset tokenization market is segmented by asset type (real estate, debt, investment funds, private equity, public equity, other asset types), end-user verticals (institutional investors, retail investors), geography (North America, Europe, Asia-Pacific, Latin America, Middle East and Africa). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
| By Asset Type | |
| Real Estate | |
| Debt | |
| Investment Funds | |
| Private Equity | |
| Public Equity | |
| Other Types |
| By End-user Vertical | |
| Institutional Investors | |
| Retail Investors |
| By Geography*** | |
| North America | |
| Europe | |
| Asia | |
| Australia and New Zealand | |
| Latin America | |
| Middle East and Africa |
Asset Tokenization Market Research Faqs
How big is the Asset Tokenization Market?
The Asset Tokenization Market size is expected to reach USD 1.43 trillion in 2024 and grow at a CAGR of 45.46% to reach USD 9.37 trillion by 2029.
What is the current Asset Tokenization Market size?
In 2024, the Asset Tokenization Market size is expected to reach USD 1.43 trillion.
Who are the key players in Asset Tokenization Market?
Securitize Markets, LLC, tZERO Technologies, SoluLab Inc., Blocktunix Inc. and Block Gemini Inc. are the major companies operating in the Asset Tokenization Market.
Which is the fastest growing region in Asset Tokenization Market?
Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in Asset Tokenization Market?
In 2024, the North America accounts for the largest market share in Asset Tokenization Market.
What years does this Asset Tokenization Market cover, and what was the market size in 2023?
In 2023, the Asset Tokenization Market size was estimated at USD 0.78 trillion. The report covers the Asset Tokenization Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Asset Tokenization Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Asset Tokenization Industry Report
Statistics for the 2024 Asset Tokenization market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Asset Tokenization analysis includes a market forecast outlook for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
