Standard Chartered: DeFi Assets Poised for $2.7 Trillion Leap by 2030 Amid Tokenization Surge

According to a groundbreaking report from Standard Chartered, the decentralized finance (DeFi) sector is set to undergo a seismic transformation, with assets locked in DeFi anticipated to skyrocket by a staggering 37 times, reaching an estimated $2.7 trillion by 2030. This astronomical growth is largely attributed to the increasing prevalence of tokenized real-world assets and native crypto assets transitioning onto blockchain networks.

Geoff Kendrick, the head of digital assets research at Standard Chartered, emphasized the potential of DeFi protocols as a new frontier for generational wealth creation in digital assets. "I estimate that the amount of tokenized assets active in DeFi will 37x by the end of 2030," Kendrick stated in a recent research note.

Despite the optimistic forecast, current participation levels indicate room for significant growth: only 3% of stablecoins and 10% of tokenized real-world assets (RWAs) are currently utilized in DeFi. Kendrick projects that this share could expand to 30% by 2030, a sign of the burgeoning potential for tokenized finance.

This forecast serves as a barometer for institutional appetite towards tokenization, which many analysts believe is key to expanding capital inflows into DeFi. However, for this predicted $2.7 trillion mark to materialize, a rapid acceleration in the adoption of on-chain assets is vital, in addition to a nearly ninefold increase in the proportion of tokenized value employed in DeFi protocols.

In a previous projection, Standard Chartered anticipated that non-stablecoin tokenized RWAs could reach a value of $2 trillion by the end of 2028, driven mainly by tokenized money-market funds and US equities.

Challenges linger on the horizon, however. Experts like Chris Kim, CEO of Axis, have warned that the tokenization wave does not inherently equate to efficient market dynamics. “Issuing the same asset across multiple blockchains and formats can create siloed liquidity, pricing gaps, and higher costs,” Kim noted, cautioning against assumptions of seamless trading as market values surge.

Oya Celiktemur, Ondo Finance’s sales director for Europe, echoed similar sentiments at Paris Blockchain Week, insisting that tokenizing illiquid assets does not automatically enhance their liquidity.

As the market evolves, platforms like Uniswap are primed to play a crucial role. Kendrick pointed to Uniswap as a likely central exchange as more tokenized assets flow onto the blockchain, attributing its credibility and established history to its potential appeal among traditional financial institutions.

“If Uniswap can commercialize effectively and forge significant partnerships with traditional finance, its market cap-to-transaction-fees ratio is expected to improve,” Kendrick observed, perhaps narrowing the competitive gap with established exchanges like Coinbase.

The dramatic growth projections and challenges outlined by Standard Chartered indicate a rapidly evolving landscape in DeFi, characterized by unprecedented opportunities as well as pressing hurdles that stakeholders must navigate.

Source: Cointelegraph

Source: CoinTelegraph DeFi