5 Milestones that summarize the progress of digital assets in 2023

The blockchain revolution has continued its unstoppable rise in 2023. On the 15th anniversary of the publication of Bitcoin: A Peer-to-Peer Electronic Cash System, the white paper through which bitcoin was born, the pioneering cryptocurrency remains an attractive investment asset, but the crypto market has proven to have much more potential.

Blockchain technology is here to stay and is already influencing the activity of traditional financial actors, central banks and regulatory entities. Meanwhile, the tokenization of goods and services is progressing at great speed, with more and more countries, markets and industries joining the digital revolution. These five milestones summarize the progress of digital assets in 2023.

2022 ended with the bankruptcy of FTX, one of the biggest cryptocurrency exchange platforms. This event added further doubts to the volatile cryptocurrency market after two difficult years. However, 2023 has been a year of recovery. The two cryptocurrencies that are often used as a market reference (bitcoin and ether) have risen in value in recent months and, in particular, in the last quarter of the year.

At the time of writing this article, and according to CoinDesk data, bitcoin's value has risen above the $40,000 barrier, while ether has exceeded 2,200. The first has gained more than 160% since January and the second has doubled its value. The growing interest of some of the planet's largest investment funds, such as BlackRock or Fidelity, appears to have revived a market that aims to continue growing in 2024.

After a long debate that took place during most of 2022 and 2023, the European Parliament finally approved the European Union's cryptoasset market regulation (known as MiCA). MiCA regulates different types of cryptoassets, although it leaves out new paradigms such as DeFi (decentralized finance) or non-fungible tokens (better known as NFT). The European regulation is the first of its kind in the world, and many experts agree that it will provide legal certainty, strengthen consumer protection and promote innovation.

The blockchain universe has brought a new verb into our lives: tokenize, the action of transforming and representing a physical, financial or intellectual asset as a digital file. A token is a piece of computer code that grants a right to a given subject, such as the ownership of an asset, access to goods or a service or the execution or receipt of a payment. This tokenization can be applied to almost any transaction in almost any market, from real estate to financial.

The tokenization of the copyright of Fillette au béret, by Pablo Picasso, the possibility that some platforms have created for banks to issue, store and maintain tokenized assets or the trade of tokens linked to real estate are just some of the recent examples of this tokenization of the economy. According to the World Economic Forum, 10% of global gross domestic product (GDP) will be transacted as a tokenized asset in 2027. The consultancy firm BCG estimates that this figure will be reached in 2030.

The number of countries that have seen an opportunity in digital assets to gain liquidity and promote innovation has continued to rise in recent years. According to the Chainalysis Global Crypto Adoption Index, the countries with a greater proportion of tokenized wealth are India, Nigeria, Vietnam, the United States and Ukraine. But beyond this data, there are nations that are firmly committed to leading the financial revolution 2.0. Switzerland is one of them.

According to the Binance cryptocurrency exchange platform, Switzerland is one of seven countries worldwide with a more user-friendly environment for digital assets. Thanks to a robust regulatory framework and a commitment to an innovative environment, Switzerland has managed to attract more than 1,000 blockchain companies in the last decade, has taken the lead in regulating the tokenization of the economy and has introduced many traditional financial actors to finance 2.0.

Taking advantage of the country's unique situation, BBVA in Switzerland was a pioneer among the major banks in the Eurozone in implementing a cryptoasset purchase and custody service two years ago. Recently, the bank successfully migrated its custody service to the Harmonize platform™ from Metaco, which offers greater operational agility, maximum security and opens the door to the bank extending its range of services in the future to meet the needs of its private banking customers and their institutional customers, such as fund managers and large companies that need to explore new business and value exchange opportunities in the digital environment. 

BBVA's subsidiary in Switzerland has been one of the companies that has led the transition of traditional banking players towards finance 2.0. It has been introducing crypto-related services and offers since 2021. This year it launched Blockchain to Go, a series of 12 training modules to ensure an easy and clear understanding of finance 2.0, and it has trained 70% of its employees to meet customers' digital needs. 

BBVA Switzerland is no longer the only bank that understands the potential of this technology. More and more traditional banks and financial institutions are committing to blockchain technology. Not only as part of their investment portfolio, but also to secure its transactions, make them more traceable and transparent, and explore new methods of business and innovation.