Blockchain Tech Could Unlock $3 Trillion in LATAM Markets by 2030

LATAM markets are on the cusp of a transformation driven by real-world asset (RWA) tokenization, a development highlighted by a recent report from Bitfinex Securities. According to the report, blockchain-based tokenization of traditional assets such as bonds and equities can significantly reduce costs and increase market accessibility, addressing longstanding inefficiencies in the region’s capital markets [1]. Chronic issues such as high fees, complex regulations, and slow transaction speeds have historically hindered investment and limited financial inclusion across countries like Argentina, Brazil, Mexico, Chile, and El Salvador [2]. These systemic problems contribute to what the report terms “liquidity latency,” a phenomenon that describes the inefficiencies locking up capital and slowing economic development [3].

Tokenization offers a compelling solution by digitizing asset ownership through blockchain technology, allowing for fractional ownership and streamlined management. The Bitfinex Securities report estimates that tokenized securities could reduce issuance costs to 2-4 percent of the capital raised, compared to traditional methods, while cutting listing times to 60-90 days [1]. This efficiency is attributed to the removal of intermediaries and the direct connection it creates between issuers and investors. Jesse Knutson, Head of Operations at Bitfinex Securities, emphasized that tokenization marks a generational shift in finance, enabling faster and more cost-effective access to capital [4].

The regulatory environment in some LATAM countries, particularly El Salvador, supports the adoption of tokenized assets. In 2021, El Salvador became the first country to recognize Bitcoin as legal tender, and in 2023, it passed the Digital Assets Issuance Law (LEAD), establishing a regulated framework for asset tokenization [1]. These developments position Latin America as a potential leader in the tokenization wave, with the added benefit of fostering financial inclusion and democratizing investment opportunities.

Beyond financial benefits, the report highlights the socio-economic impact of tokenization. By lowering barriers to entry for investors and entrepreneurs, tokenization can expand access to capital, promote entrepreneurship, and improve market depth. The Bitfinex Securities Market Inclusion Report includes insights from eight Latin American countries, underscoring the broad potential for growth across the region [2]. Moreover, blockchain’s transparency and efficiency can enhance trust in financial systems, encouraging both local and international participation in LATAM markets [1].

The momentum around tokenization is also supported by broader market trends. McKinsey estimates that tokenized securities could reach $3 trillion in the bull case and $1.8 trillion in the base case by 2030 [3]. In Latin America, the adoption of stablecoins like USDC and USDT has already demonstrated a shift toward digital assets for financial stability, with stablecoins accounting for nearly 40 percent of crypto purchases on platforms like Bitso [3]. These trends suggest that the region is not only open to innovation but actively embracing it.

Source:

[1] RWA Tokenization Poised to Revolutionize LATAM Markets (https://www.livebitcoinnews.com/rwa-tokenization-poised-to-revolutionize-latam-markets/)

[2] Bitfinex Securities Market Inclusion Report Unveils LATAM Capital Market Challenges And Opportunities (https://blog.bitfinex.com/education/bitfinex-securities-market-inclusion-report-unveils-latam-capital-market-challenges-and-opportunities/)

[3] Tokenization could unlock capital markets growth in Latin ... (https://cointelegraph.com/news/tokenization-adoption-drive-investment-latam-regions)

[4] Bitfinex Securities Report Highlights Tokenisation's Role in ... (https://blockchain.news/news/bitfinex-securities-tokenisation-latam-market)