GDF: Digital infra is biggest challenge for real-world asset tokenisation

GDF: Digital infra is biggest challenge for real-world asset tokenisation

17 juli 2024

Fiduciair Management Technologie ESG
Technologie (06) AI artificial intelligence cloud

Study finds that biggest challenge for financial firms are digital infrastructure, custody issues and ESG considerations.

‘Nine out of ten finance firms questioned identified digital infrastructure as the biggest challenge for buy-side adoption, ahead of 69% selecting custody issues and 61% ESG considerations,’ reports industry association Global Digital Finance (GDF) today from own study with finance firms in the US, Asia, Europe (including the UK) and the Middle East, responsible for more than $ 221.75 billion assets under management.’ ‘The research asked major financial institutions to rate ten current challenges to buy-side adoption of tokenization.’

‘More than half (51%) pointed to a lack of regulatory certainty and cash on-ledger solutions while 44% pointed to interoperability and 42% to a lack of smart contract standards. Some 39% highlighted distribution issues and 37% cited a lack of token standards. Just 16% said liquidity.’

‘Buy-side engagement is regarded as a critical accelerator of RWA tokenization adoption, confirmed by two-thirds (66%) of the survey respondents. However, the same number say more scale in production use cases would help while 65% say cash-on-ledger is important and 64% want greater regulatory certainty. Almost as important however is a wider range of assets being available, which 59% questioned say would help drive buy-side engagement and ultimately accelerate adoption of RWA tokenization.’

Participating ‘financial firms are generally positive about the ESG impact of mainstream digital asset trading and tokenization. Around 83% agree tokenization will be positive for ESG and 89% believe artificial intelligence will play a major role in enabling digitization and tokenization. Additionally, 83% highlight the importance of asset interoperability in this context.

Up to three out of four (75%) point to the significance of cybersecurity in digitization of financial services and enabling real-world assets tokenization, with 85% emphasizing the role that DeFi will play. Over four out of five (81%) recognize the significance of digital identity for the digitization of financial services and increased tokenization, with an equal number highlighting the importance of payment interoperability.’

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