A Bitfinex report has revealed that Latin America is on the cusp of a financial revolution in the coming months, driven by a mainstream adoption of tokenization by investors and traditional institutions.
The inaugural Bitfinex Securities Market Inclusion Report noted that tokenization of financial instruments using blockchain technology offers a rare socio-economic opportunity for the emerging region. The report hinged its findings on the responses of LATAM experts and financial sector players from eight nations, including Brazil, Argentina, Chile, Colombia, Panama, and Peru.
It noted that a digital representation of financial instruments will address a raft of challenges plaguing traditional capital markets in the region. Steep fees, complex regulations, red tape, and bureaucracy slow the region’s capital markets.
“Tokenisation represents the first genuine opportunity in generations to rethink finance,” said Bitfinex Securities Head of Operations Jesse Knutson. “It lowers costs, accelerates access, and creates a more direct connection between issuers and investors.”
The report highlights tokenization benefits, underscoring the perks of slashing listing times to 60 days and supporting fractional ownership by a broader demographic. Per the report, blockchain-based securities can reduce issuance costs to as low as 4% of capital raised while advancing accessibility and efficiency.
A spate of regulatory developments in Latin America suggests that the region is poised for a wholesale adoption of tokenization. The region’s earliest foray was El Salvador’s recognition of Bitcoin as legal tender in 2021, with financial institutions in the Nayib Bukele-led country angling for tokenization.
In 2023, El Salvador passed the Digital Assets Issuance Law (LEAD) to provide a regulated framework for asset tokenization. Meanwhile, Brazil and Argentina have made significant strides in adopting tokenization in their local financial ecosystems via pilots and forward-thinking regulations.
Latin America joins the digitization trend
Despite playing second fiddle in global digitization, several reports have predicted that Latin America will record impressive growth spurts by the end of the decade. The early signs are already in place with countries in the region turning to stablecoins as a hedge against currency devaluations and inflation.
Brazil’s digital asset mining sector has recorded significant activity in the last year, supplemented by a push into central bank digital currencies (CBDCs). Regarding digital payments, Brazil’s Pix is targeting an automated payment feature to add as much as $30B in transaction volume before the end of the year.
RWA protocol breaches rake in $14.6M in the first half of 2025
Amid the impressive adoption milestones achieved by real-world asset (RWA) protocols, a report has identified a gaping surge in the value of losses from security breaches.
The report, compiled by CertiK, revealed that RWA-specific exploits reached $14.6 million in H1 2025, surpassing the entire volume of losses in 2024. In 2024, RWA protocol security breaches cost projects only $6 million in losses, while the ecosystem scored losses worth $17.9 million in 2023.
While fluctuations in losses have been easily identifiable in the last three years, CertiK analysts have identified an evolution in RWA tokenization security breaches. In the early days, breaches revolved around off-chain credit defaults, but recent hacks are focused on on-chain and operational security failures.
The analysts indicate that bad actors are going beyond exploiting vulnerabilities in the smart contract code to employ oracle manipulation. Furthermore, bad actors lean on custodial and counterparty failure to fleece projects of funds, while others brazenly mask behind an unenforceable legal framework and fake Proof-of-Reserve attestations.
“The security framework for RWAs is defined by the interface between trust-minimized DeFi protocols and trust-based traditional financial systems,” read the report.
Several risks emerge from the model given the input of human actors in the operational process. A keen example is a fully audited smart contract that can be adversely affected by an off-chain custodian becoming insolvent.
RWA protocols face dire risks across the asset, legal, operational, data, and on-chain layers, with bad actors unveiling new schemes across the board. In terms of distributed ledgers, CertiK analysts revealed that Ethereum is bearing the brunt of RWA tokenization losses, with Avalanche and Solana coming in second and third place.
However, the report noted that Tradfi-backed protocols offer advanced security than others in the ecosystem. Specifically, the report namechecks BlackRock and Franklin Templeton’s RWA tokenization offering, characterized by institutional-grade compliance and transparency.
RWA tokenization poised for meteoric growth in 2025
Despite the streak of security breaches, RWA tokenization is primed for explosive growth in 2025. A joint report by Keyrock and Centrifuge has tipped the RWA tokenization market to reach a $50 billion market capitalization before the end of the year.
The report likens the incoming growth spurt to the ETF revolution in 2009 that changed the financial market landscape. Last year, a Tren Finance report predicted that RWA tokens are the next 50x trend in the digital asset ecosystem, buoyed by renewed institutional and retail interest.
Watch: Minting Tokens on BSV
Source: https://coingeek.com/tokenization-fuels-latam-rwa-protocol-breach-reached-14-6m/