LAT Research: The Exponential Growth of Crypto Markets to $5 trillion

The LATokens research team, formed by Deutsche Bank and McKinsey alumni, have prepared the first LAT Crypto Research, outlining that total market capitalization of cryptocurrencies can reach $5 trillion by 2025, with asset-backed tokens driving the growth.

To read the full report, follow the link, highlights of the report are below:

Total Market Cap to Reach $5 tn by 2025

Cryptocurrencies market capitalization has surged by 830% from last August, reaching $165 billion. The adoption rate of cryptocurrencies may be as high as that of cell phones and broadband Internet, thanks to advantages of blockchain, such as low transaction costs, security, transparency, ease of cross-border transactions etc.

By that time crypto wallet penetration can exceed 5% of the world’s population, as the adoption rates of new technologies have significantly accelerated at the beginning of the 21st century. To illustrate, the number of crypto wallets has doubled every year since 2013.

The average wallet size today is $9,835. We expect that by 2025 the average wallet size can exceed $12,000, bringing total cryptocurrency capitalization to $5 trillion. Demand for crypto will be driven by the emergence of less volatile asset cryptocurrencies.

Asset Cryptocurrencies Will Drive the Growth

According to LAT Crypto Research, the market capitalization of asset cryptocurrencies, also known as asset-backed tokens, can account for at least 80% of the total market by 2025. As their value is linked to asset prices, ranging from equities and commodities to real estate and works of art, they combine the benefits of blockchain with advantages of investing in hard assets, like greater stability.

Today volatility of crypto markets often makes investors reallocate funds from their crypto portfolios back into fiat and hard assets. Asset cryptocurrencies provide them with an attractive alternative to getting the same exposure while saving costs of conversion from crypto to fiat. They may become indispensable for crypto portfolio diversification.

Notable examples are tokens linked to fiat currencies are Tether (linked to USD), Digix (linked to precious metals) and tokenized shares of blue chips, along with oil and gold listed at the LAT Platform. LAToken analytics expect the value of asset cryptocurrencies to exceed $4 trillion by 2025, driving the growth of the crypto markets.

Trading Volume of Asset Cryptocurrencies to Reach $40 tn by 2025

According to LAT Crypto Research, trading volume of asset cryptocurrencies can exceed $40 trillion by 2025, while in a longer perspective it can exceed the capitalization of the traded assets by 10+ times. The current overall value of the major asset classes today is $600 trillion, thus the trading volume potential of asset cryptocurrencies could reach as much as $6 quadrillion.

Meanwhile, tokenization of previously illiquid assets increases their market value by 10–40% as illiquidity costs vanish. High illiquidity costs make asset tokenization a very attractive opportunity for asset owners.

LAToken is the first multi-asset tokenization platform.

We already launched trades of Real Estate LAT backed by ETF at the LAT Platform. You can buy it in your Wallet along with the shares of Apple, Tesla, Google and other blue chips, as well as gold and oil, to diversify your crypto portfolio with real assets without converting to fiat.

 

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