Colin Butler, Head of Global Institutional Capital at Polygon Labs, believes that real-world asset tokenization for institutional investors could be a killer app for cryptocurrencies as it significantly reduces costs and settlement times.
This technology could be a huge disruptor to the entire global financial system,
' Butler said, before talking about the capital efficiency and business opportunities for all financial institutions moving to tokenized assets.
Polygon's CEO explained that lower costs will allow financial institutions to consider new business models that were previously unfeasible due to competitive markets and low margins.
A simple graph showing real-world asset #tokenization . Source: chainlink.
G Mr. Butler gave an example of a fund manager reporting incredibly small margins in administration and profiting from double-digit cost savings. An executive told Cointelegraph:
Like all currency trading, all options, stocks and bonds, it is the best collateral for the global financial system. That's why it could be the killer of #cryptocurrencies . It's an order of magnitude bigger addressable market than any other cryptocurrency claims to be.
Butler stressed that financial companies, from small financial institutions to international clearing houses, will benefit from dramatic reductions in costs and settlement times thanks to tokenized assets such as bonds, U. S. Treasury bills and stable coins.
#Polygon executives previously told Cointelegraph that real-world assets represent a $30 trillion opportunity for investors as all global assets move onto the #blockchain . According to Cointelegraph Research, investments in tokenized U. S. Treasury securities alone are expected to exceed $3 billion by the end of 2024.
Not everyone agrees with Butler's view that the market for tokenized assets will reach that size, however. Jamie Coates, chief crypto analyst at Real Vision, believes that tokenized real assets will approach $ 1.3 trillion by 2030.
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