The Avalanche Foundation, the company behind the smart contract blockchain network Avalanche (AVAX), has announced a $50 million initiative, dubbed Avalanche Vista, to spur the blockchain tokenization of real-world assets (RWA).
According to a blog post by the Foundation on Tuesday, July 25, the Avalanche Vista program will use its allocated $50 million to purchase a wide range of tokenized real-world assets (RWA) minted on its blockchain network. The planned purchases include “equity, credit, real estate, commodities, as well as those that are blockchain-native.”
Today, the Avalanche Foundation introduces Avalanche Vista, a $50M initiative to pioneer tokenization on #Avalanche
Tokenization is poised to be one of the most impactful blockchain innovations of the next decade, and Avalanche is uniquely equipped to power these systems. pic.twitter.com/ZWy109CMCi
— Avalanche 🔺 (@avax) July 25, 2023
The company said:
“The program, “Avalanche Vista,” aims to support and demonstrate the value of tokenization, the process of creating an on-chain digital representation of an asset, item, or thing–something that is designed to facilitate with greater speed, scalability, and customizability.”
Tokenization in the Avalanche Blockchain: The Next Killer Use Case
Avalanche Vista has come at a time when the blockchain has become home to some noticeable asset tokenization activity. In September 2023, US investment management giant KKR tokenized a part of its flagship private equity fund on Avalanche’s blockchain through digital assets securities firm Securitize.
The blockchain ecosystem is also home to IntainMARKETS, an administration platform and tokenized marketplace for asset-backed securities built as an Avalanche Evergreen Subnet.
Tokenization is forecasted to be the next “killer use case” in the blockchain and crypto sectors. In its March 2023 “Money, Tokens and Games” report, US investment behemoth Citi predicted an 80-fold increase from the current value of RWA locked on blockchains. Citi estimated that the value of blockchain tokenization of RWA could reach between $4 trillion to $5 trillion by 2030.
The potential and value that tokenization unlocks can not be understated. Currently, the most popular use case of tokenization is real estate. It not only facilitates digital asset transactions such as buying and selling properties but also democratizes asset allocation by allowing small investors to enter the otherwise prohibitively expensive market.
The range of tokenization is not limited to real estate only and digital collectibles. It is giving birth to a new financial sector called on-chain finance (OnFi) that wraps around an array of use cases, such as private equity, venture capital, debt instruments, and intellectual property.
With its Vista program, the Foundation aims to pioneer the future of asset tokenization. John Wu, President of Ava Labs, stated:
“Asset tokenization isn’t just the future of capital markets, it’s a critical driver of the present. The groundswell of momentum across institutions building on-chain has been astounding, and the Avalanche Foundation is taking a big leap forward with this initiative.”
