Fund Managers See Alternative Asset Classes as Frontline for Tokenization

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Opalesque Industry Update – Private equity and hedge fund assets are most likely to see relevant levels of tokenization as the market begins to build, according to new global research from tokenization platform Token City.

The study, conducted with fund managers in France, Spain, Germany, Switzerland and the UK, who are responsible for approximately $546.5 billion in assets under management, found that 73% identified private equity assets and 65% indicated that hedge fund assets were the most likely to be the first to see significant levels of tokenization.

The World Economic Forum estimates that up to 10% of global GDP will be stored and processed via DLT by 2027 and tokenized markets could potentially be worth up to $24 trillion by 2027.

Research from Madrid-based Token City shows that most fund managers (93%) believe alternative asset classes are more likely to be targeted for tokenization due to their lack of liquidity, transparency and affordability compared to traditional asset classes.

Private equity and hedge fund assets lead as alternative asset classes considered most likely to be first to attract relevant levels of tokenization – however, 58% point to private debt and more half (55%) identify venture capital assets as strong growth poles. Around 41% say real estate could be the first sector to experience significant levels of tokenization, while only 8% point to infrastructure.

Token City Founder and CEO Yael H Oaknin said, “Fund managers are starting to focus on the potential uses and benefits of tokenization and see alternative assets as having the most potential. The benefits for funds of improved liquidity, transparency, and accessibility make tokenization truly attractive. “.

Token City supports investors and organizations wishing to assess the market in a safe and secure way. It provides the platform infrastructure and comprehensive services needed to issue, manage, and trade security tokens.

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