A couple of big issues stand in the way of real-world asset tokenization, according to the chief executive of the global investment management giant VanEck.
In a new interview with Raoul Pal, VanEck CEO Jan van Eck says that liquidity is a “big issue” for tokenization.
“Who provides the liquidity? Anyone can theoretically tokenize anything. But if there’s a buyer and a seller of an asset, someone’s got to make that market.
And you think, ‘Oh, Jan, S&P 500 – it’s so obvious. So easy to price.’ But someone has to make a market in it, and someone’s got to make money making a market in it, so it’s not just that [someone] can create a tokenized real-world asset of anything, it’s who’s providing the market structure around the liquidity.”
Van Eck says the second big issue with real-world tokenization is figuring out where to make a market without a “regulatory headache.”
“In the world today, you’re not doing that in the United States. That’s fine. My bet is on Europe just because it’s got a large retail market as well as having a regulatory structure that enables crypto investing and trading.”
Van Eck is one of 11 firms that received approval from the U.S. Securities and Exchange Commission (SEC) to launch spot Bitcoin (BTC) exchange-traded fund earlier this month.
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