Traditional investors trying their luck on the digital market

In March 2022, investors were bullish on the non-fungible token and cryptocurrency markets. However, this does not automatically mean it’s not a sound investment. Amid expectations of recovery, and the potential opportunities posed by Web 3.0, investors are eager to invest in the digital market once more.

Traditional finance players are now capitalising on a fresh wave of tokenisation such as those representing traditional asset classes and distributed ledgers in tokenised form.

As a response to many centralised exchanges closing, investors are now relying on traditional institutions like banks and reliable third-party firms to help take care of their holdings.

Even governments are supporting the shift to better asset protection.

More from OMY: S’pore is open to digital assets innovation, but not to crypto speculation, says DPM Wong

For instance, Japan’s Financial Services Agency now requires domestic exchanges to keep 95% of their customer’s assets offline.

Even the Australian Treasury announced new standards for safekeeping the crypto assets of clients.

The US Securities and Exchanges Commission has also followed suit by proposing investment advisors keep crypto assets only with qualified custodians.

Through redefining digital asset ownership, the market toward the tokenisation of traditional assets may thrive. This move also comes amid monetary tightening measures, including recession news.

When it comes to regulation, Asia-Pacific governments are also redefining their legal framework on digital assets. Previous problems have inspired government agencies to make their regulations stricter and clearer to protect investors.

For example, MAS is clarifying the tax on digital assets and supporting the tokenization of real estate economy assets.

By pushing the boundaries of what assets can be, investors can unlock more potential in digital assets.

More from OMY: What and How You Should Invest During a Recession in Singapore



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