As the tokenized real-world assets (RWAs) marketplace experiences exponential growth, Prometheum’s co-CEO and founder, Aaron Kaplan, disputes the common assumption that regulatory hurdles are impeding the sector’s wider acceptance. Instead, he highlights the scarcity of dedicated secondary markets for trading tokenized securities as the main obstacle.
In a conversation with Cointelegraph, Kaplan referred to the recent statements made by ARK Invest CEO Cathie Wood at the Digital Asset Summit in New York. Wood had indicated that unclear regulations are stopping her firm from tokenizing its funds.
Kaplan, however, opposes this view, emphasizing that the existing regulations in the US, including the Securities and Exchange Commission’s (SEC) special purpose broker-dealer framework and Alternative Trading System (ATS) licensing, already offer a legal route for issuing blockchain-based funds that surpass traditional issuances in efficiency.
“The true impediment is the insufficient market infrastructure necessary for enabling a broad range of investors to trade tokenized securities,” Kaplan explained.
The value of tokenized RWAs, excluding stablecoins, has seen a nearly 8% increase to $19.5 billion in the last 30 days, as per industry data. The dominant use cases are private credit and US Treasury debt.
According to Kaplan, two strategies are being used to develop these platforms. The first involves using decentralized finance (DeFi) frameworks to construct tokenized securities markets, like what Ondo Finance, Ethena Labs and Securitize are doing. The second approach integrates tokenization protocols into SEC-registered brokerage platforms that adhere to federal securities laws.
Kaplan argues that the fight for market share is fierce, with many traditional platforms investing in their own tokenization initiatives or collaborating with fintech and crypto firms to stay competitive.
As a digital asset trading and custody firm, Prometheum is striving to bridge this infrastructure gap by creating a comprehensive digital asset securities marketplace. It claims that securities traded on its platform benefit from lower fees, expedited settlement times, and enhanced efficiency.
Tokenized assets are gaining popularity in the real estate sector, with luxury and commercial properties being tokenized across North America and secondary markets being formed for trading these tokenized shares.
A 2024 report by Boston Consulting Group (BCG) touted tokenization as a “revolutionary blockchain use case in financial services” due to its scalability and near-instant transactions, with the potential of boosting investors’ annual returns by an estimated $100 billion.
Even the World Economic Forum highlighted the potential of tokenization in a recent article by Digital Asset co-founder and CEO Yuvan Rooz. He suggested that tokenization, which enhances collateral mobility and capital efficiency, could unlock untapped capital and optimize intraday liquidity.
