Crypto Assets innovation is changing the financial landscape

Innovation in the Crypto Assets field is triggering significant changes in the financial world. In the past, people often mocked the lack of practical applications of Crypto Assets, but this view has become outdated. The latest wave of Crypto Assets enthusiasm has brought about significant differences.

With the signing of the Stablecoin Act, regulatory certainty has been provided for stablecoins, and the industry is thriving. Wall Street is actively participating, and the trading volume of on-chain assets, including stocks, money market funds, and various other assets, is rapidly increasing.

This revolution has sparked different reactions. Some believe that this new technology could become a pillar of the global financial system, while others are concerned that it may lead to "currency privatization." Regardless, the current transformation may be more disruptive than the early speculation in Crypto Assets.

The stablecoin market is rapidly expanding. It is expected that the market value will reach $2 trillion in three years. Some large banks have also begun to launch their own stablecoin products. The tokenized asset market, although smaller in scale, is growing rapidly.

The advantages of stablecoins lie in their low and fast transaction costs, making them particularly suitable for cross-border transactions. The new legislation will provide support for stablecoins. Some retail giants are also considering launching their own stablecoins, which could impact the traditional payment industry.

Tokenized assets are digital replicas of other assets that can make financial transactions faster. While some products may be just a gimmick, there are also some products that hold real value. For example, tokenized money market funds can also serve as a payment method while providing higher returns.

These new types of assets pose a challenge to existing financial institutions. Bank deposits may face competition, which could affect banks' financing costs and profit margins. Tokenization may also change the concept of asset ownership, bringing new challenges to regulation.

Pairing illiquid private assets with easily tradable tokens opens up new investment channels for retail investors. However, this has also raised concerns about information disclosure and investor protection. Regulators want to ensure that tokens are not used to circumvent securities laws.

Overall, if stablecoins and tokenized assets are truly useful, they will also be genuinely disruptive. They may profoundly change the financial system, bringing opportunities and challenges. In any case, the Crypto Assets space has already produced noteworthy innovations, and this is beyond doubt.