Provenance: Leader in the Race to Tokenize Wall Street

Introduction

Tokenization has long been heralded as a killer use case for blockchains both public and private. However, forecasts for the size of the tokenized asset market have seen significant downward revisions in recent years. While BCG projected a $16T market by 2030 in their 2022 report, McKinsey's latest analysis suggests a much more modest outcome of $1-4T, with their base case below $2T. These figures align more closely with other recent predictions, such as Citi and Bernstein, who both forecast $5T (Citi by 2030, Bernstein by 2028). While this has not yet emerged, there are signs that the industry could be on the precipice of achieving these lofty figures. 

Optimism surrounding tokenization stems from the natural characteristics of blockchains that aren’t seen in legacy rails. Blockchain-based asset digitization improves upon traditional financial processes by fundamentally restructuring how assets are managed and traded. The technology enables transactions to settle instantaneously rather than taking multiple days, while simultaneously slashing operational costs across the entire financial stack. By removing the need for intermediaries like custodians, trustees, and clearing houses, the system becomes more streamlined and cost-effective. Smart contracts automate compliance procedures that previously required manual oversight, while the distributed ledger serves as an immutable, unified record of all transactions - eliminating the need for multiple parties to maintain and reconcile separate databases. This comprehensive solution transforms what was once a complex, multi-party process into an efficient, automated system.

However, current blockchain implementations often miss their transformative potential by merely creating digital representations of traditional assets rather than truly native digital instruments. When platforms simply mirror existing offchain assets with onchain tokens, they effectively create a parallel system that adds complexity and operational overhead rather than reducing it. This approach not only introduces unnecessary costs but also fails to establish clear legal ownership rights within the blockchain framework. Furthermore, users face additional counterparty risk since they're interacting with protocols that may lack insurance or proper legal backing for the underlying assets. This creates a situation where the technology is being used as an expensive overlay rather than as the foundational infrastructure it was designed to be. 

Provenance

Provenance is an L1 blockchain built using the Cosmos SDK that focuses solely on RWAs. It functions as an integrated platform that combines a ledger system, asset registry, and trading capabilities. Built specifically to accommodate regulated financial operations, its architecture prioritizes the needs of financial services. It has 4-second block times and claims to handle up to 115 transactions per second. However, the current TPS is largely irrelevant at the moment, as we will see later. Provenance uses the HASH token for governance, staking, and transaction fees. Below we show the HASH token price since 2022.