Raredex is now live on the Arbittrium blockchain. This marks a significant shift in the accessibility of an asset class that has long been the preserve of institutional investors.
Raredex is a blockchain-based platform on the Arbitrum network that gives investors access to rare earth metals. Rare earth metals, which are needed for businesses ranging from technology development to renewable energy, have traditionally been difficult to access for private investors, hampered by high entry costs – often above $10,000. Raredex solves this by enabling fractional ownership using blockchain-based tokenization, where each token represents one kilogram of physical metal.
Louis O’Connor, CEO of Raredex, highlighted the democratization potential, saying that “Early adopters” will now have access to an asset class that has “typically been reserved for governments” or the “well-connected, wealthy” individuals. that investors can now enter the market on a smaller scale, with much less capital required.
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How does Raredex work?
Raredex stores its physical metals in a bank-grade vault operated by Tradium in Germany for access to custody and availability. Investors can verify the provenance of their tokens as they are all tagged with extensive provenance data. Using blockchain technology creates an immutable record of ownership, reducing the risk of fraud and increasing transparency.
The launch of the platform comes at a time of increased interest in RWA tokenization. This update comes amid a larger trend to tokenize real-world assets. By 2023, the class of RWAs had grown 700%, generating $860 million in revenue. According to Boston Consulting Group and ADDX, RWAs are expected to be a $16 trillion market by 2030. The decentralized, tamper-resistant nature of blockchain will increase transparency and trust, while fragmentation opens up new ways to access and invest in valuable assets.
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The chart estimates that the tokenization of global illiquid assets will reach $16.1 trillion by 2030, representing 10% of global GDP. This shows that Raredex, operating in the RWA category, is ready for growth. Sourced from ADDX by crypto.news.
Other similar initiatives include UBS Asset Management’s Ethereum-hosted tokenized investment fund and Archax’s $4.8 billion money market fund on the XRP Ledger.
As there is a rising demand for rare earths due to innovations in technology and clean energy, Raredex’s platform could be a model for a broader wave of commodity trading on the blockchain, transforming how investors interact with physical assets.
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