Rewiring Finance: Why Tokenization Is An Infrastructure Story, Not A Digital Assets One

Forbes

7 days ago

Eric Piscini, Chief Executive Officer of Hashgraph.
'Tokenization' might be the buzzword of the industry, and while it's easy to get swept up thinking it's the next big thing in digital assets, like the metaverse or memecoins, it's really not about hype. It's about replacing outdated financial systems and processes with programmable, 24/7 infrastructure, where speed, compliance and transparency are built in from the start.
I believe the future of finance won't be built by banks but by those who are building the rails and the blockchain infrastructure itself. Think of it not only as a technical overhaul but also as an operational one, transforming how assets are issued, transferred and settled. The smart institutions aren't asking whether it will work. They're mapping out how far they can go with it.
Why All The Fuss?
What may start with a narrow use case, like accelerating real-time payments and settlements, often evolves into a broader rethinking of market infrastructure that can quietly transform the way the world does business. What's promising is that regulators aren't just watching—they're actively responding.
In the U.K., UAE and Singapore, frameworks are emerging that actively support the future of digital finance. From the U.K.'s sandbox initiatives to Singapore's detailed token classification and licensing regimes, these governments are building rulebooks around the reality that tokenization is here to stay. And major financial players are moving in.
BlackRock is tokenizing money market funds. Citi is piloting custody and settlement. Franklin Templeton has been issuing shares on-chain since 2021. J.P. Morgan is piloting a USD deposit token (JPMD) to support on-chain payments and native cash settlement for institutional clients. These aren't crypto startups; they're established financial institutions rebuilding their own systems from the inside out. Think of it less like launching a new app and more like Wall Street quietly swapping out dial-up for fiber internet.
The Numbers Say It All
Tokenized RWAs have just surpassed $24 billion. This isn't a trend line; it's a launch curve. The steady rise in the first half of 2025 signals velocity, not just growth. And with Standard Chartered projecting $30.1 trillion in tokenized assets by 2034, a figure notably on par with the current U.S. GDP, we're not looking at a niche upgrade. We're witnessing a full-scale reallocation of the financial system's plumbing.
Visibility, Speed And A Seat At The Table
Legacy systems created silos. Private markets often operated with limited transparency and slow reporting. That kind of opacity rewarded insiders and excluded broader participation.
Tokenization flips that model. Imagine running a business where every stakeholder sees a different version of the ledger—that's what private markets used to be. With tokenization, everyone sees the same data at the same time, like moving from fragmented spreadsheets to a single live dashboard. That shift eliminates inefficiencies, improves accountability and builds the kind of shared visibility that real trust is built on.
In fact, Coinbase and Kraken are actively exploring the tokenization of traditional equities, with the goal of enabling 24/7 stock trading on-chain. This could extend market access, improve settlement efficiency and increase competitive pressure on traditional exchanges such as the NYSE.
Settlement can now happen in minutes, not days. Compliance and documentation can be handled by smart contracts instead of paper and PDFs. Fractional ownership opens up access to asset classes that used to be out of reach for most investors. Tokenization doesn't just modernize systems; it reshapes who gets to participate.
There's Friction, But Also A Clearer Path Forward
Yes, there are still hurdles as regulation lags behind the tech. But global regulators are slowly catching up. The EU's MiCA framework is now live. The UAE has established a dedicated Virtual Asset Authority. The U.K. is planning a Crypto Roadmap by 2026. In the U.S., if the CLARITY Act is passed, it would provide a much clearer regulatory framework for digital assets, particularly by distinguishing between "digital commodities" and "securities." This would offer companies a more defined path to engage with digital assets in a compliant manner, replacing the uncertainty that has historically hindered the growth of tokenization.
On the enterprise side, many are wary of diving deep into Web3 due to a need for privacy, particularly in highly regulated industries. That's where hybrid infrastructure comes in: models that blend public transparency with private transaction control. Enterprises can scale into public systems while keeping sensitive data shielded. It's not a binary choice between 'status quo' and public networks with utility tokens; it's now a spectrum.
Still, forward-looking companies aren't waiting. They're engaging regulators, aligning with emerging standards and investing in interoperability now. This isn't defensive. It's a long-term advantage.
Looking Ahead
Tokenized real-world assets aren't here to replace traditional instruments. They're here to expand the menu. Lower entry points, broader access and new formats will complement existing portfolios, not compete with them.
This is evolution, not upheaval. But make no mistake: Tokenization is changing how ownership is defined, how capital flows and how trust is embedded in systems.
So the real question isn't when this will happen. It's whether your organization is building for it now. Because the rails are being rebuilt. And those building them will shape what comes next!
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