Tokenization of Real Assets (RWA) is Driving Crypto Adoption: Bank of America | coindesk JAPAN | Coindesk Japan

Bank of America (BAC) said the market capitalization of tokenized gold topped $1 billion last month as the tokenization of real world assets (RWA) accelerates. ) announced in a research report on April 13.

Tokenization is the placing of ownership of tangible assets, such as precious metals, on the blockchain, providing the convenience of buying and selling these assets 24 hours a day for transactions that do not go through traditional brokers.

Bank of America sees the tokenization of real-world assets such as commodities, currencies and stocks as “a key driver of crypto adoption.”

Prior to the advent of tokenized gold, investors seeking exposure to the gold market could purchase exchange-traded funds (ETFs) or futures, while those seeking exposure to physical gold could purchase through dealers. But “these investment vehicles have drawbacks in terms of cost and liquidity,” the report said.

Analysts Alkesh Shah and Andrew Moss said: “Tokenized gold can replace exposure to physical gold with 24/7 real-time payments without management fees, storage and storage. It offers no insurance premiums,” and furthermore, the low minimum investment makes it more accessible, and “fragmentation allows the transfer of ownership and value of physical gold that was not possible before.” writing.

Tokenizing precious metals will also increase liquidity, allowing investors to balance their portfolios quickly and efficiently, the report notes.

Tokenization of the gold supply chain could also benefit ESG-focused investors who need proof that gold came from a particular mine or a particular region, he said.

｜Translation: coindesk JAPAN
｜Editing: Toshihiko Inoue
｜Image: Shutterstock
｜Original: Tokenization of Real-World Assets a Key Driver of Digital Asset Adoption: Bank of America