The Rise of Tokenisation: Stocks and Non-Dollar Stablecoins Take the Lead

Jesse Pollak, the founder of Base, recently shared exciting insights about the future of tokenisation at the Token2049 event in Singapore. He believes that a significant shift toward tokenisation is on the horizon, predominantly driven by tokenised stocks and stablecoins tied to currencies other than the US dollar.

Tokenisation's Next Steps

Pollak emphasized that the journey of tokenisation has already started with the US dollar being represented on blockchain technology. He suggested that the next logical progression will encompass both US and global stocks. Furthermore, Pollak expressed particular interest in the potential for tokenising various national currencies beyond the dollar, stating, "People are underestimating it." This perspective highlights a broader potential for the tokenisation of finance, bridging gaps across different currencies.

The Current Landscape of Stablecoins

Despite the overwhelming prevalence of dollar-denominated stablecoins, Pollak noted that there is still a substantial demand for transactions in local currencies. Currently, Base supports 32 stablecoins connected to 21 different currencies, notably including the euro, Canadian dollar, Nigerian naira, and Indonesian rupiah. While over 99% of the stablecoin market is pegged to the dollar, there is a notable trend of increasing interest in non-dollar stablecoins, particularly those associated with the Japanese yen and British pound.

Growth of Tokenised Stocks

According to Pollak, the sector of tokenised stocks is experiencing rapid growth. The circulating value of these tokenised stocks surged to $3.3 billion last month, up from approximately $400 million in September of the previous year. Pollak highlighted the recent launch of tokenised stock trading on Base, initiated by Coinbase just six weeks ago. Daily trading volumes in this market fluctuate between $70 million and $100 million, and currently, there are 50 publicly listed stocks available, with plans to increase this number to 250 by the month’s end. A major advantage of tokenised stocks, as Pollak points out, is their 24/7 trading availability, instant sell capabilities, and the ability to transfer stocks to anyone seamlessly.

Future Plans for Base

This year, Base has shifted its focus towards three major areas: trading, payments, and finance. Pollak announced that the platform intends to develop these sectors even further next year. A particularly ambitious project involves collaborating with Cloudflare to create a machine-to-machine payment system capable of processing one million transactions per second. Pollak predicts, "Over the next 1 to 2 years, all finance will move around agents," indicating a vision for Base as a key player in this evolving landscape.

Resilience of Layer 2 Solutions

Recent shutdowns of projects like Blast and Abstract have raised questions about the durability of layer 2 solutions. However, Pollak views this trend as a natural part of the business cycle rather than a death knell for layer 2 experimentation. He remarked, "A chain is also a business. Not every business succeeds," reaffirming his commitment to the ongoing evolution of blockchain technology.