According to CoinDesk, a survey conducted by the Official Monetary and Financial Institutions Forum (OMFIF) reveals that a significant level of tokenization in financial markets is expected to occur within the next three years. The survey, which included responses from 26 institutions such as treasuries, banks, and asset managers across Europe, Africa, Asia, and South America, found that 92% of participants believe financial markets will experience substantial tokenization, although it is anticipated to be at least three years away.
The survey also highlighted that 65% of respondents identified bonds as the most likely asset to be tokenized. This trend is already evident, with 14 blockchain bonds issued totaling $1.2 billion as of July 31 this year, nearly matching the $1.7 billion from 16 bonds issued in 2023. Additionally, 42% of respondents agree that blockchain will become the dominant form of financial market infrastructure, underscoring the growing importance of tokenization, which involves the digitization of real-world assets.
Countries worldwide have been exploring blockchain and tokenization as the future of financial markets. Recently, UK Finance announced the completion of an experimental phase involving tokenization, central bank digital currency (CBDC), and ledger platforms. This experiment saw participation from major banks like Barclays, Citi UK, HSBC, and Natwest, along with seven UK Finance members. Similarly, the Bank for International Settlements (BIS), often referred to as the central bank of central banks, disclosed that 40 selected firms had joined its initiative to explore tokenization.
The OMFIF survey also indicated a preference among market participants for wholesale CBDCs over other forms of tokenized cash. Wholesale CBDCs are digital tokens issued by central banks for use by institutions only. The report emphasized that effective adoption of these digital currencies would depend on robust regulatory frameworks. The findings suggest a clear inclination towards wholesale CBDCs, reflecting the ongoing efforts to integrate digital innovations into the financial sector.
