Tokenization introduces accessibility and democratization to the private equity market. Private Equity Sees Individual Investors as The Next Great Growth Engine.
According to Bain & Company’s Private Equity Midyear Report 2024, private equity deals, exits, and funds closed slowed in the first half of 2024. Most funds are still struggling to raise fresh capital.
Individuals control over half of global wealth, but only a small fraction (around 5%) is invested in alternative assets such as private equity and hedge funds. now, “private equity is targeting individual investors,” said Bain & Company’s Global Private Equity Report.
Citi projects that by 2030, the value of tokenized private equity will reach $0.7 trillion, representing 10% of the overall $7 trillion private equity and venture capital market.
Real-World Assets (RWAs) refer to tangible assets that exist outside the digital realm. These can range from bonds to stocks, real estate properties, commodities, and machinery. Boston Consulting Group projects that even using a conservative methodology, asset tokenization would be a US$16.1 trillion business opportunity by 2030. In a best-case scenario, that estimate goes up to US$68 trillion.