We all know that tokenization of real-world assets (RWA's) is going to be the next-big thing in crypto. When Larry Fink of Blackrock tells you that tokenization is “the next generation for markets", you listen.
According to Boston Consulting Group, tokenization of illiquid assets alone (i.e. Real Estate, Private Equity, etc...) will be a $16 trillion industry, and over 80% of that $16 trillion pie is made up of securities. Without the requisite licensing to deal with securities you cannot legally tokenize them.
It’s hard to predict who the winners will be, especially because this is not a “winner takes all” type of opportunity, but one thing we do know is that if you want to tokenize billions of dollars of assets, you must work with the big banks and financial institutions, and that means you need to be licensed and/or regulatory-compliant.
The Blue Chip RWA Project: Chintai AKA $CHEX
One project that has emerged as a clear “blue chip” RWA project is Chintai ($CHEX token). Chintai offers a one-stop shop to tokenize and trade RWA’s in a regulatory compliant way. One thing that makes Chintai unique is that they hold two key licenses from Singapore's MAS (their equivalent to the SEC) allowing them to issue and trade securities. This is a key competitive advantage as it allows them to legally deal with securities in one of the world’s top 5 financial hubs. Do not understate the significance of this - there is a reason many of the world’s largest financial institutions have offices in Singapore.
Chintai: Like Shopify For Tokenization
Chintai offers an “out of the box” solution that allows you to tokenize any asset, trade it on-chain, and automatically enforce compliance controls. Driven by institutional client requirements, Chintai’s RWA platform works like Shopify, providing their clients with the tools they need to go-to-market quickly. Their white-label solution would allow, for example, Blackrock or JP Morgan to launch their own branded RWA exchange, while behind the scenes, everything is powered by Chintai.
The white-label version of Chintai is where most of its volume/activity will likely be derived from, but they really have 4 products:
Whitelabel – Blockchain as a Service
Chintai Singapore – Securities exchange, for qualified investors
Chintai Nexus – Non-Securities, for all investors
Compliance as a Service – by leveraging Chintai’s automated compliance rules engine DeFi protocols (i.e. Uniswap or Jupiter) could legally offer compliant RWA trading.
CHEX Token: The Oil That Powers The Chintai Machine
The CHEX token is a utility token that is used for handling transactions on the Chintai blockchain and is also used to incentivize liquidity to the platform. It’s been referred to as “the oil that powers the machine” by the CEO of Chintai, because to use any of Chintai’s products - whether its Chintai Singapore, Nexus or a whitelableled version of their exchange - you must use CHEX (you can opt to pay fees in fiat which are then converted into CHEX for you).
The token is 100% fully distributed and was fair launched back in 2019 via a Dutch Auction. There are 998.8 million tokens, and it is deflationary, with 5% of fees earned being used for token buybacks and burns, permanently removing some of the supply from circulation over time. Furthermore, 10% of the fees earned by Chintai goes towards staking revenue (actual yield from a revenue generating business, not from printing/unlocking new tokens). That means there will be constant buying pressure once the platform launches.
The CHEX token is multi-chain, existing on Ethereum, Binance Smart Chain, EOS and soon, Solana.
Clients, Partnerships & Projections
Little is known about Chintai's exact list of clients due to NDA's in place, however the CEO of Chintai recently confirmed that they expect their clients to issue “low-to-mid billions” in 2024 alone. Some of these issuances are expected to be on the smaller side ($10-$50M), while others are expected to be much larger, but one thing we know for sure is that they have some major institutional clients lined-up.
If we pretend that total value issued (i.e. the amount of RWA's issued by Chintai clients) is the same as total value locked (TVL), we should expect the CHEX token should do incredibly well. For comparison sakes, every single chain with $150M+ in TVL is valued over $1B. Meanwhile Chintai is expecting to have several billions of dollars of RWA’s under management in 2024. Giddy up!
Conclusion
Back in Febuary 2020, 4-years ago, the Chintai team announced their intention to apply for MAS licensing and build a tokenization platform. For crypto standards, they’ve been waiting an eternity for this moment. CHEX holders may be handsomely rewarded for their patience.
This is not a project that saw the RWA narrative heating up and decided they want to take advantage of it – this is a project that demonstrated impressive foresight from day 1 by realizing the need for licensing and regulatory compliance to deal with RWA’s before 99% of people even heard of “tokenization”.
Since then, the team has been head-down building non-stop to prepare for this very moment. Now, with launch around the corner, it seems that the “stars are aligning” for Chintai who are poised to be immensely successful in 2024.
Building Chintai has been a long time coming, and after many years of waiting, it’s about to kick off.
Giddy up!
nice write up, is there a discord or telegram group?