Bank of America Predicts 99 of Crypto Tokens Will Disappear Over 10 Years

Bank of America has issued a bold projection in a recently circulated report, suggesting that nearly 99% of the over 26,000 crypto tokens currently in existence are expected to disappear over the next ten years [1]. The report, analyzed and shared by crypto researcher SMQKE, highlights the long-term implications of the evolving financial infrastructure and the anticipated role of tokenization in redefining traditional finance and blockchain applications [1].

The report emphasizes that today’s financial systems are largely built on outdated, centralized infrastructures that lack interoperability and efficiency. These systems, many of which have been in place for over two decades, are increasingly being challenged by emerging technologies like tokenization [1]. BofA Global Research anticipates a transformation in the next 15 years, as tokenization becomes more integrated into both financial and non-financial sectors. The process involves creating digital, programmable representations of real-world assets using distributed ledger technologies.

One key distinction made in the report is between tokenized assets and traditional crypto tokens. Tokenized assets are described as digital representations of real-world value that can be securely transacted within regulated, permissioned systems. In contrast, many existing crypto tokens are characterized as unnecessary or redundant, serving primarily speculative or experimental purposes [1]. The report argues that most of these tokens lack long-term utility and are unlikely to survive as the market consolidates.

According to the analysis, the survival of a small subset of crypto tokens will depend on factors such as institutional backing, real-world application, and widespread adoption. While the report does not specify which tokens will endure, it implies a future where only a few projects with strong fundamentals will remain relevant [1]. This forecast aligns with the broader trend of financial institutions exploring blockchain’s efficiency without embracing the volatility and decentralized nature of public crypto markets.

Bank of America’s projection reflects growing skepticism among major financial players regarding the sustainability of the vast majority of digital assets. The prediction underscores the need for investors to critically evaluate the underlying value and purpose of crypto projects before committing capital. It also highlights the speculative nature of the current market and the potential for significant market consolidation.

This development has generated mixed reactions in the broader market, with investor sentiment oscillating between optimism and caution. However, there have been no immediate regulatory or policy responses to the report. As the crypto landscape continues to evolve, the question remains: how many of these tokens will ultimately disappear, and which will stand the test of time?

Sources:

[1] Bank of America: 99% of Crypto Assets Will Disappear https://coinmarketcap.com/community/articles/6896da75a49b911721ba5447/