Asia’s largest asset managers and financial services corporations have formed a representing group, which has published a document analysing the future of tokenized securities as a part of the average institutional toolkit, as well as calling on extra regulatory clarity to open the path.
According to the Asia Securities Industry and Financial Markets Association, tokenized securities have the perspective of becoming a useful tool for financial organizations under the right circumstances.
As to the document, the group believes that tokenized securities have the opportunity of becoming innovative financing and capital raising method that is scalable, provides liquidity and is efficient. Also, it was mentioned that the bridge between blockchain technologies and usual financial tools and products would offer stakeholders a combination of the security of a controlled mechanism and benefits of the blockchain itself.
Tokenized securities have many advantages, such as automated compliance, faster settlement speeds and round-the-clock trading. This is a relatively new concept within the still-nascent blockchain sphere, which has mostly been dominated by cryptocurrencies such as Bitcoin. Industries like real estate paid prominent attention to the tokenized securities. Still, there has been limited adoption of the model as institutional investors remain cautious and regulators work to catch up with the quickly evolving technology.
According to the report: “Tokenized securities are going to require innovative solutions that go beyond technology. In some cases, judicial reform will be needed.”