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Digital Assets in 2024: Building Trust through Regulation and Innovation

By Manhar Garegrat

 

After a turbulent 2022, digital assets bounced back in 2023, with Bitcoin more than doubling in value and regulatory frameworks emerging around the globe. As we head into 2024, several key trends are poised to shape the future of this dynamic industry, with exciting opportunities for both individuals and businesses.

 

Regulation: Building a Foundation of Trust

One of the most significant trends in 2024 will be the continued development of comprehensive regulatory frameworks for digital assets. Regulators worldwide are embracing innovation while safeguarding consumers through robust frameworks. Being a leading digital asset custody platform, we are at the forefront of this movement with a TCSP license in Hong Kong and an In-Principle Approval (IPA) from the Abu Dhabi Global Market (ADGM) FSRA. We are also actively pursuing licenses in other key jurisdictions like the Dubai International Financial Centre (DIFC) and Singapore, demonstrating our commitment to the highest compliance standards.

This proactive approach towards regulation reflects the industry’s belief in transparency and security as bedrock principles for a thriving digital asset ecosystem. The international frameworks like the IMF-FSB Implementation Guidelines are accelerating this wave of regulatory clarity. As more jurisdictions get active, compliance translates into a significant competitive advantage. Adherence to rigorous regulatory standards fosters trust amongst clients and investors, positioning us as reliable partners for navigating the evolving landscape.

 

Democratizing Investment through Financial Asset Tokenization:

The tokenization of traditional financial assets or Real World Assets (RWAs), such as real estate and securities, is another transformative trend expected to gain momentum in 2024. By placing these assets on blockchain networks, tokenization can democratize access to investment opportunities, enhance liquidity, and introduce greater transparency to conventional markets.

This trend presents exciting possibilities for both individual investors and financial institutions. Imagine being able to invest in a fraction of a high-value property or participate in a private equity fund through a simple tokenized offering. For financial institutions, tokenization can unlock new revenue streams and streamline investment processes.

At Liminal, we’re actively developing solutions that enable the secure and efficient custody of a wide range of tokenized assets. This democratization of investment will boost liquidity, enhance transparency, and open up new avenues for wealth creation for individuals and institutions alike.

 

Web3 Gaming: Transforming the Way We Play and Own

The convergence of digital assets and the burgeoning Web3 gaming industry is another exciting trend to watch in 2024. Blockchain technology is enabling the creation of truly immersive and interactive gaming experiences, where players can own and trade in-game assets as valuable digital items. This opens up new possibilities for monetization, community engagement, and even virtual economies within gaming platforms.

For gamers, this means the potential to truly own their in-game assets, such as rare characters or virtual land. These assets can be traded or sold on marketplaces, potentially generating real-world value from their virtual exploits. For game developers, tokenization presents new ways to engage their communities and generate revenue.

 

A Future Built on Innovation and Trust

The digital asset landscape is rapidly evolving, and 2024 promises to be a year of significant transformation. By embracing regulation, tokenization, and innovation, the industry can build a more secure, transparent, and inclusive future for everyone. As we move forward, it is essential to remember that trust is the cornerstone of any successful financial system. By working together to build a trusted and regulated digital asset ecosystem, we can unlock the full potential of this revolutionary technology and create a brighter future for all.

 

(The author is Manhar Garegrat, Country head India and Global Partnerships at Liminal, and the views expressed in this article are his own)