KUALA LUMPUR (Sept 13): The total size of tokenised illiquid assets, including real estate and natural resources, could reach US$16.1 trillion by 2030.

Citing a newly released report from Boston Consulting Group (BCG) and digital exchange for private markets ADDX, crypto industry news portal Cointelegraph on Tuesday (Sept 13) quoted BCG managing director Sumit Kumar and ADDX co-founder Darius Liu as saying that “a large chunk of the world’s wealth today is locked in illiquid assets”.

According to the report, illiquid assets include pre-IPO stocks, real estate, private debt, revenues from small and medium businesses, physical art, exotic beverages, private funds, wholesale bonds, and many more.

Reasons for this asset illiquidity are attributed to factors such as limited affordability for mass investors, lack of wealth manager expertise, limited access — such as when assets are restricted to elite cliques (in the case of fine art and vintage cars), regulatory hurdles, and other scenarios in which users have difficulty acquiring or trading an asset.

The portal said on-chain asset tokenisation could solve this problem, a market that surpassed US$2.3 billion in 2021 and is expected to reach US$5.6 billion by 2026, as per the report.

It said the authors added that in just the last two years, global digital asset daily trading volume has soared from €30 billion in 2020 to €150 billion in 2022, noting that it "is still minuscule in comparison to the total potential of illiquid tokenisable assets in the world”.

By 2030, the authors forecast the on-chain asset tokenisation opportunity to reach US$16.1 trillion — made up largely of financial assets (such as insurance policies, pensions, and alternative investments), home equity, and other tokenisable assets, such as infrastructure projects, car fleets, and patents.