Impact of Bitcoin Halving on Real-World Assets Explained

In a recent interview, Kinto co-founder and CEO Ramon Recuero shared insights on various aspects surrounding real-world assets, shedding light on potential impacts.

In the realm of institutional investments, the concept of real-world assets (RWAs) has been gaining traction, prompting discussions on its future trajectory during influential market events like the recent Bitcoin halving.

Regarding the impact of the halving on RWA investments, Recuero emphasized that while there might not be a direct effect, historical patterns suggest an indirect correlation. “The halving has traditionally preceded the hype season of every cycle, increasing focus, attention, and capital directed at the space,” he said.

Recuero highlighted Maker DAO as a notable player, attributing its longevity and prominence in the space. Additionally, he mentioned other successful assets such as Backed, Centrifuge, Mountain Protocol, and the BUIDL fund by Blackrock, signifying a diverse landscape of winning ventures within the RWA sphere.

Recuero expressed a cautious outlook regarding a timeline for mainstream adoption of RWAs, estimating a timeframe spanning years to a decade. The Kinto CEO elaborated on the current predominant use case around access to tokenized U.S. treasuries, citing products like the BUIDL fund, Mountain USDM, and Maker as facilitators of on-chain access to short-term treasury bills. However, Recuero noted that broader applications like home equity loans or tokenized equities may necessitate a more protracted adoption period.

Recuero anticipated short-term attention and flowed towards ETFs by institutional entities because of the recent halving, with a more substantial impact over the medium-to-long term. “The halving affects supply at the margin, and it should create the base for the next bull market,” he said, indicating a structural shift in market dynamics with potential ramifications for various investment vehicles.

Recuero’s insights provide a nuanced perspective on the evolving landscape of RWAs, navigating the intersections of market cycles, institutional interests, and technological innovation. As RWAs continue to garner attention and investment, the journey toward mainstream adoption remains a dynamic narrative shaped by diverse factors and stakeholders.