Is tokenization of securities the way of the future? In an interview with Raiffeisen Bank International, the bankers leading its blockchain research hub stated that indeed, by 2030, most securities will have been tokenized. To gain a deeper understanding of how blockchain technology can transform traditional stock exchanges, Cointelegraph Research compiled a dataset of all security token offerings and found that almost $5 billion was raised in 2020.
Cointelegraph’s first report on security tokens explains how bond and stock tokenization works, how many assets have already been tokenized, what returns they have provided, and how they are regulated in different countries.
A new opportunity
A recent trend is the self-custody of securities and the reemergence of bearer financial instruments. Tokenization of financial instruments allows investors to remove securities from an exchange and send them to a new exchange with a private key.
Exchanges can attract investors to deposit securities by offering them interest on their deposits for lending their securities to the exchange,