It may seem that Tether has faced enough negativity recently. Protos analysts even counted that since 2015, Tether has attracted the attention of U.S. authorities 19 times.
Now, a serious competitor from Wall Street may be added to the list of troubles. According to Bloomberg, major players like BlackRock and WisdomTree are beginning to offer tokenized real-world assets (RWAs) as an alternative to the largest stablecoin, USDT.
During price fluctuations, crypto traders typically move their positions in digital assets to stablecoins pegged to the U.S. dollar or other traditional (fiat) currencies to protect against potential losses. They also use stablecoins as collateral when trading derivatives. This behavior has not gone unnoticed by Wall Street companies, which have developed a serious competitor to Tether and its stablecoin USDT.
BlackRock and WisdomTree have started offering investors tokenized assets
Tokenization is the process of converting physical assets, such as real estate or works of art, into a digital form known as tokens. Each token represents a portion of the asset, allowing for better management of ownership rights and simplifying access to investments..
Traditional stablecoins like USDT do not offer their users any additional benefits. In contrast, new tokenized money market funds offer yields in the range of 4-5% provided the underlying asset’s price increases.
BlackRock is in talks with cryptocurrency exchanges about using its tokens as collateral, while WisdomTree is actively collaborating with brokerage firms to expand the utility of its tokens. Moreover, the financial company Lazard plans to create tokenized funds together with Bitfinex Securities and SkyBridge Invest.
Currently, the focus is on money market funds, but as RWA develops, users will have the opportunity to hold capital in tokens backed by gold, stocks, and other traditional assets, which could also generate profits, unlike traditional stablecoins.
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