Real-world asset tokenization has taken over the minds of top executives of some of the biggest firms. They feel it is one of crypto’s biggest use-cases while the sector gets targeted on a daily basis by financial big-wigs.
Research firm K33 said in its Wednesday report the Chainlink’s native token (LINK) could be the “safest bet” for those who seek to profit from the hype.
If we wish to have exposure to the RWA narrative and avoid being sidelined when it takes off, LINK is the safest bet
David Zimmerman, K33 analyst.
How will Tokenization impact?
Placing real-world traditional financial assets such as private equity, credit and bonds on blockchain refers to Tokenization. It is being anticipated that it will improve transparency and accessibility and reduce cost plus operational frictions.
Earlier today, financial giant JP Morgan carried out its first live blockchain based collateral settlement transaction with Barclays and Blackrock. The firm has also praised the potential of tokenization in the recent past.
Tokenization hurdles
Zimmerman’s report underscores that there are several challenges to overcome before tokenized assets fully reach their potential.
But, he believes that the backing behind such assets is so attractive that it could trigger an isolated crypto bubble focused on tokenized assets. He estimates it could happen before they have a substantial impact in the real world.
He highlights that Chainlink has positioned itself as a component to bridge the gap between several blockchain networks and the external world. Zimmerman credits it to its wide range of partnerships. Chainlink might not be the biggest gainer in this context, however, it stands to benefit from this narrative.
At what price should I enter Chainlink?
Zimmerman also suggested that investors wait for prices to dip lower before considering long positions, specifically pointing to a significant support level at around $5.70.
One should do proper research before investing into high-risk assets like cryptocurrencies. Investing without proper research and experience can lead to substantial loses.