Tokenization Could Spark a Crypto Boom. These Are the 2 Coins to Watch
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| By Beth Canova |
What if you could buy a piece of a stock, bond or real estate deal with just a few clicks?
No broker. No long wait. And no need for a large sum of cash.
What if you can then put them to work? What if, instead of sitting idle in an account, those same assets could earn you passive income while you hold?
That may sound like a dream.
But it's fast becoming real. And it could lead to one of the biggest shifts in how we invest since the birth of online trading.
It's called tokenization. And Wall Street is starting to take it very seriously.
Big banks and asset firms are moving more of their business onto the blockchain. And that could bring a flood of new money into crypto.
For investors, the key is to spot the projects that stand to gain from this shift today.
Because the best time to invest in a big trend is often before the crowd catches on.
Tokenization: A New Way to Own Real Assets
Let's start with the basics: Tokenization is a way to turn a real asset into a digital token.
Think of a stock, a bond or a piece of real estate. Today, you often need a broker, bank or fund to buy and sell these assets.
Which means some deals are out of reach for most people.
Tokenization could change that.
It lets firms create digital tokens tied to real assets. Those tokens can then move on a blockchain — the same type of tech used by Bitcoin and other cryptos to trade instantly, 24/7
Here's a simple example.
Say a building is worth $1 million. Instead of selling the whole thing to one buyer, its owner could create tokens tied to smaller stakes in the property.
That could let more people take part.
Of course, each token would need clear legal rights. And not all assets can be split up so easily. But the idea is clear …
Tokenization could make it faster, cheaper and easier to invest.
It could also let some assets trade around the clock.
For Wall Street, that means less paperwork and faster deals. For crypto, it means a chance to bring stocks, bonds and other assets onto blockchain networks.
And the shift is already under way.
I told you on Oct. 9, tokenized stocks had surged 395% in September alone.
That's a sign of how fast this market can grow.
But before you jump into buying tokenized assets, there is a smarter way for investors to benefit. And that is in the on-chain projects that are building the tools and portals that’ll make the entire sector work.
And there are two in particular that should be on your radar.
Ondo Finance: Bringing Wall Street On-Chain
First is Ondo Finance (ONDO).
Ondo wants to link Wall Street with the world of crypto. And it's making real progress in that effort.
Its products bring assets like U.S. Treasury securities and stocks onto blockchain networks. That matters because these are assets investors already know and trust.
Ondo doesn't need to sell the world on a new type of investment. It just needs to offer a new way to hold and trade familiar ones.
And its reach is growing.
Ondo's website lists more than 450 assets on its tokenized stock platform. It also reports about $1.34 billion in value locked in that platform.
That's real scale.
Ondo has also worked with major names in finance.
In May, it announced a deal with J.P. Morgan's Kinexys, Mastercard and Ripple to test a new way to move funds across banks and borders.
These links could give Ondo a strong edge as more firms move on-chain.
The big draw? Ondo is helping build a bridge between two huge markets.
But there are risks. Ondo faces tough rivals. And laws still limit who can use some of its products.
Its tokenized stock platform, for one, is not open to U.S. users.
But the biggest consideration for crypto investors is this: Growth in Ondo's business does not mean the ONDO token must rise in price.
The token's value will depend on demand, supply and how it is used.
Still, Ondo is one of the first names I'd research as this trend grows.
Plume: Building the Rails for a New Market
The second project is Plume (PLUME).
While Ondo aims to bring assets on-chain, Plume is building tools to help those assets move through existing blockchains and earn income.
Think of Ondo as a bridge. And Plume as the road crew building the streets on the other side.
Its network is made for real-world assets, or RWAs. That is, assets like bonds, loans and other forms of credit. Plume helps firms bring those assets onto blockchain networks and into the realm of decentralized finance (DeFi).
Why? Because DeFi allows users to put those tokenized assets to work in ways not possible in TradFi investing.
And it has made some big moves.
Its website highlights work with Apollo, a major name in private credit. It also points to a $100 million plan with EtherFi to bring more real-world asset income products to crypto users.
That matters. It shows Plume is not just chasing small crypto firms. It's also trying to serve large pools of capital.
Plume's site lists income products with stated annual yields of up to 12%. That’s about 3x-4x higher than what your average money market account offers.
But high yields come with risk.
Loans can go bad. Assets can lose value. And access to funds may change when markets turn. And tokenized assets can add an additional layer between spot prices and what’s recorded on-chain, increasing the chance these risks come into play.
And just like ONDO, the PLUME token may not rise even if the network grows. Developers will need to be careful in how they connect platform revenue to token value.
Still, its focus on the tools behind tokenization and its early traction make this project worth a close look.
The Time to Start Watching Is Now
Here's the big picture …
Wall Street has trillions of dollars in stocks, bonds and other assets. So far, only a small share has moved onto blockchain networks.
And one of the largest markets in the world, the average U.S. investor, doesn’t have access to those tokenized assets.
That leaves a huge market for firms that can help make the shift.
Ondo and Plume are taking two paths to that goal.
- Ondo is helping bring familiar assets into crypto.
- Plume is building tools to put those assets work once they get there.
Neither is a sure bet. But both are worth your attention in these early days.
Which is why growth investors should your research now.
Look at how fast each project is growing. Check how its token is used. And weigh the risks before you buy.
Because if tokenization keeps gaining ground, the firms that build its core tools could be among the first to reap the rewards.
And the best chance to spot tomorrow's winners may be before this trend goes mainstream.
Best,
Beth Canova
P.S. Knowing what to buy is only half the challenge. When to buy is just as important. Buying the right asset at the wrong time can be just as detrimental to your portfolio as riding a losing asset down.
That’s why cycles expert Juan Villaverde is constantly working on his Crypto Timing Model. It constantly monitors the markets to see when Bitcoin and other top altcoins cross key levels. Those levels confirm when it’s time to act.
To see how the model can help you, and how you can get specific “buy” and “sell” recommendations for our long-term crypto investing, click here.
