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Every meaningful digital system begins with a verified identity. Without this foundational layer of trust, any platform, whether a financial network or a national service, is built on sand. The cost of that instability is immense. The global self-sovereign identity market is valued at USD 3.49 billion in 2025 and is expected to grow from USD 6.64 billion in 2026 to approximately USD 1,153.07 billion by 2034, expanding at a 90.52 percent CAGR.
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“Everything starts with a national ID system if you’re going to do something real. If I can’t validate who you are on a continuing basis, then you’re just wasting resources,” says Jeff Mahony, Co-founder and Chief Architect at RYT. According to him, countries in Central America alone lose billions of dollars each year to fake identities within their healthcare systems. “Digital ID is now a requirement for any national digital economy. Real deployments will rely on ongoing verification rather than one-time checks, with verified users becoming a new benchmark for success,” Mahony adds. Regulation is not the enemy; it is the entry point for serious capital. Crypto regulation is becoming more defined as legislation moves from draft to law across major markets.
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One example of this momentum came recently, when Binance founder Changpeng Zhao said he is holding talks with a dozen governments on the large-scale tokenization of state assets. This development could signal a shift in how countries fund public projects and manage national wealth. Speaking on the sidelines of the World Economic Forum’s annual meeting in 2026, Zhao described tokenization as a potential tool for sovereign financing and industrial reinvestment, pointing to growing interest in linking blockchain-based systems with traditional public finance. The disclosure highlights a deepening dialogue between cryptocurrency leaders and national policymakers as digital assets move closer to the center of economic strategy.
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By choosing the World Economic Forum as the venue for the announcement, Zhao placed the discussion firmly within the realm of mainstream policy debate rather than emerging technology circles. The talks suggest that governments are increasingly exploring tokenization not as an experiment, but as a potential component of future fiscal and investment frameworks.
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Regulatory momentum is shaping how institutions participate in crypto, with clear frameworks serving as the primary draw for capital. Regulation is framed as a necessary gate for credibility, and jurisdictions are competing to deploy workable systems that can scale while keeping markets safe. The United States has slowed progress on the CLARITY Act, while the United Kingdom moves crypto activities toward a full authorization regime under the Financial Services and Markets Act. The UAE and Switzerland are formalizing their virtual asset regimes, and sandbox programs are used to test approaches under supervision.
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Beyond regulation, tokenization surfaced as a potential tool for sovereign financing. Zhao of Binance described talks with multiple governments on large-scale tokenization of state assets during the World Economic Forum in 2026, signaling a shift toward linking blockchain-based systems with public finance. The discussions illustrate how governments may fund public projects and manage national wealth through on-chain infrastructure while maintaining policy credibility and investor protection.
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