Total Value Locked on Real-World Assets Surges 700% in 2023
The total value locked on real-world assets has experienced a significant surge of 700% year-to-date (YTD) alongside the overall growth of decentralized finance (DeFi) in 2023. This surge reflects the bullish sentiment in the market, which has seen institutional demand for cryptocurrency products rise in Q4.
Bitcoin, real-world assets, Assets Under Management (AUM), and derivatives have all attracted institutional interest. However, stablecoins have seen a decline in popularity due to potential regulatory pressures and the development of Central Bank Digital Currencies (CBDCs).
Despite this decline, stablecoin market capitalization has risen in October, driven by new capital from cryptocurrency funds and tokenization. The current market cap stands at $129 billion, below its all-time high but still relatively strong compared to altcoins.
DeFi Volume Boosts Stablecoin Growth
Analysts expect stablecoins to continue gaining market share as DeFi numbers surge. Stablecoins have been used as bridge assets between wallets and DeFi protocols, contributing to their recent growth.
CBDCs and Regulatory Pressure Shape Market Sentiment
The rise of Central Bank Digital Currencies (CBDCs) and increased regulatory pressure have influenced institutional sentiment in the cryptocurrency market. Many central banks are exploring CBDCs as a way to limit the growth of private cryptocurrencies and expand payment options.
Optimism for 2024
Looking ahead, the rollout of more CBDCs and increased institutional investment is expected to drive further growth in the market. Tokenized assets are projected to continue rising, with institutions showing particular interest in this sector.
Hot Take: Real-World Asset TVL Soars Alongside Stablecoin and CBDC Popularity in 2023
The total value locked on real-world assets has experienced a remarkable surge of 700% this year, reflecting the overall bullish sentiment in the cryptocurrency market. Institutional demand for cryptocurrency products has been on the rise, with Bitcoin, real-world assets, AUM, and derivatives attracting significant interest. While stablecoins have seen a decline due to regulatory pressures and the emergence of CBDCs, their market capitalization has rebounded in October. This growth can be attributed to new capital from cryptocurrency funds and tokenization. The future looks promising as DeFi numbers continue to climb, CBDCs gain traction, and institutions show increasing interest in tokenized assets.
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