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Circle CEO Jeremy Allaire at Davos Tokenization Panel: 'It's Coming on in a Significant Way'

Jeremy Allaire, CEO of Circle, the stablecoin company, stated that tokenization adoption will keep growing after the spot Bitcoin ETF approval and the endorsement of Blackrock. He believes that financial companies might be issuing tokenized versions of their assets this year and criticized the “same activity, same rules” regulatory principle.

Circle CEO Jeremy Allaire States Tokenization ‘Is Coming’ at Davos

Jeremy Allaire, CEO of Circle, the issuer of the USDC stablecoin, stated that the tokenization of assets will be a part of the evolution of financial companies this year. Tokenization tech, which involves creating a digitized version of an asset and putting it into a blockchain, is likely to grow this year due to its benefits versus traditional finance processes.

At a panel titled “The Tokenization Economy,” Allaire highlighted that the endorsement of Larry Fink, CEO of Blackrock, one of the world’s largest asset managers, on tokenization tech means that it is poised to be adopted in financial markets sooner than later.

On Fink’s tokenization remarks, Allaire stated:

It suggests confidence that tokenization is going to be coming on in a significant way. That we’re going to see some of the very biggest asset issuers in the world issuing tokenized versions of those assets this year. That’s significant.

Nonetheless, Allaire also acknowledged the difficulties of dealing with an unclear regulatory policy for digital assets in the U.S., where the U.S. Securities and Exchange Commission (SEC) sustains that many of these tokens are indeed securities. Asked by an attendant to the panel about the possible application of the “same activity, same risk” principle to digital assets’ regulation, Allaire stated:

That’s insane. if we had applied that to software and the internet, we wouldn’t have the incredibly flourishing global world that we have today.

While Euroclear’s CEO Lieve Mostrey, who was also part of the panel, was favorable to this approach, Allaire explained the disadvantages that adopting such a policy would bring to the industry. He argued that if this was applied in the early days of the internet, each website would have to be registered with the Federal Communications Commission (FCC) and that each audio streaming company would have to receive a radio license.

Instead, he leans into considering digital assets as a nascent field with new applications that need to be considered by upcoming specific regulations.

What do you think about tokenization and its future? Tell us in the comments section below.


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