The CEO of Circle, a cryptocurrency payment agency, Jeremy Allaire has stated that in the coming two to three years the process of securing assets through tokenization would soon become a reality.
At the most recently held World Economic Forum in Davos on 21 January, speakers, Allaire and Neha Narula, director at the Digital Currency Initiative of MIT Media Lab, talked about how tokenizing can be utilized to make liquid assets more user-friendly and accessible without the risk of financial failures.
Need for Consumer Protection and Regulation
Liquid assets are monetary assets that can be converted into cash in no time without loss of its intrinsic and market value. Allaire and Narula began their talk with a brief description of blockchain tokens, their purpose, and their use. Narula stated that the use of tokens comes with its own share of risks which further emphasizes the need for regulations and standards.
Tokenization Examples in the Real World
Explaining tokenized assets, Allaire stated the example of a farmer in India, who if need permits could tokenize his property or future crop yield and place it for offer on the international market.
And although the prospect of an individual securitizing his crop yield through tokens seems pretty far fetched, for now, development must be initiated for the prospective farmer to know the functioning and working of a stablecoin. But the idea would soon likely become a stable reality in the coming two or three years, according to Allaire.
Future of Crypto Trade
When it comes to the prospects of the crypto industry, according to Allaire the capital market would most likely resemble the commerce of the internet realm in the next five to ten years. Narula states that the coming years could see wide market experimentation with its fair share of upheavals and success.