The Avalanche Foundation is allocating up to $50M to purchase tokenized assets (often referred to as “real world assets'' or tokenized “off-chain assets”) minted on the Avalanche blockchain. The program, “Avalanche Vista,” aims to support and demonstrate the value of tokenization, the process of creating an on-chain digital representation of an asset, item or thing–something that Avalanche is designed to facilitate with greater speed, scalability, and customizability. 

The $50M allocation reflects the Avalanche Foundation’s commitment to driving forward a financial system that’s more accessible, efficient and cost-effective through the use of Avalanche’s novel consensus mechanism, unique Subnet architecture, and technical innovation. It intends to accelerate the growth of tokenization and its role in on-chain finance (“OnFi”) by demonstrating the merits of applying blockchain rails to historically more manual and operationally-intensive use cases, including asset issuance, settlement, transfer, and administration.

Avalanche Vista will consider assets across the full liquidity spectrum, including equity, credit, real estate, commodities, as well as those that are blockchain-native. 

The initiative closely follows major milestones in asset tokenization, including Securitize’s tokenizing an interest in a flagship KKR fund on the Avalanche blockchain – marking the first time exposure to one KKR’s alternative investment strategies had been offered in a digital format in the U.S.; the launch of IntainMARKETS, an administration platform and tokenized marketplace for asset-backed securities built as an Avalanche Evergreen Subnet; and the launch of Avalanche Spruce, where participating buy- and sell-side institutions are using the  testnet environment for a variety of applications and assets to explore the benefits of OnFi.

“Asset tokenization isn’t just the future of capital markets, it’s a critical driver of the present,” said John Wu, President of Ava Labs. “The groundswell of momentum across institutions building on-chain has been astounding, and the Avalanche Foundation is taking a big leap forward with this initiative.”

Unlocking broader access to private market investing has been a longstanding challenge for the industry. Historically, investments in private markets have been primarily reserved for large institutional investors and ultra-high-net-worth individuals. Among the barriers preventing broader access and smaller investment minimums have been high operational costs to facilitate manually-intensive functions like capital calls, change of ownership in secondary markets, underlying data availability, and fund disbursements. 

On-chain asset issuance and administration, when combined with tokenization, can help solve this by enabling technologies that create significant efficiencies in these processes and improve the asset issuer and investor experience. 

The past year has seen an acceleration among both traditional financial institutions and crypto native initiatives to enable on-chain use cases with tokenized assets typically held off-chain. 

“Moving parts of the asset administration process on-chain allows issuers to have one workflow and one system of record, enabling a better, more seamless user experience for service providers and investors,” said Siddhartha, Founder and CEO of Intain, a leading structured finance platform.

According to a report by Security Token Advisors, 77% of capital markets participants believe traditional securities will be digitized within 5-10 years, and the size of the tokenized securities market alone is expected to grow to $20T by the end of 2030. Further, asset manager VanEck predicted that institutions will tokenize $25B in off-chain assets in 2023.‍‍

About Avalanche

Avalanche is a high-performance blockchain platform designed for builders who need to scale. Engineered with a revolutionary three-part Layer 1 (L1) architecture, Avalanche is anchored by its Avalanche Consensus Mechanism, ensuring near-instant finality for transactions. The platform also features an open-source Layer 0 (L0) framework, enabling the seamless creation of interoperable Layer 1 blockchains with high throughput on both public and private networks.

Supported by a global community of developers and validators, Avalanche offers a fast, low-cost environment for building the next generation of decentralized applications (dApps). With its unique blend of speed, flexibility, and scalability, Avalanche is the preferred choice for innovators pushing the boundaries of blockchain technology.

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