Security Tokens: The Megatrend of Crypto

I am following the space since nearly ten years now and witnessed quite some trends so far. The one that probably got me most excited was the concept of “colored coins” back then. While it was quite simple, it took some years until more and more tokens spread that are a representation of something else than the token, like a USD or Gold. This is just one example of a common characteristic I observed with all of the new trends, not matter how convincing or easy they seem to be: they take much longer than expected. With that experience in my bag I still love to observe and follow trends and get excited about them. The only difference is that I take some time before really getting excited and especially before I expect something material. There is one trend that I am keen on since two years but that I knew would take time to develop, not because it is technically complex, but because it is legally complex: security tokens. Having seen the first shy baby steps, I believe we will "soon" (=by the end of 2020) see the first larger and more serious approaches that will mark the beginning of a new era and will be dwarfed by what is about to come. I do not see crypto as something distinct from traditional financial markets that at some time might be adopted by its big brother in form of more and more institutions investing in Bitcoin. Rather, I think of crypto as a technology that will soak through more and more areas of our society. And with regards to securities, I believe that as soon as it becomes evident how superior token-based securities are compared to their paper-based securities, it will not take too long until paper-based securities will be a matter of the past. Such seismic shifts in societies and markets usually start very slowly and can get quite fast and brutal at their peaks. This is what I expect to see here as well: two more years of slow growth (slow compared to the size of legacy financial markets, this could still be large compared to crypto market caps) before a period of 3-5 years of mega-growth where the whole old system gets deconstructed and every stock, every fund, every bond, any kind of asset will get tokenized. Now is the time to get prepared for this megatrend.