Tokenization is coming for capital markets

Tokenization is rapidly emerging as a foundational shift in how global capital markets operate. According to BCG, tokenized assets could represent up to $16 trillion in value by 2030, spanning everything from real estate and private credit to collectibles and infrastructure. Meanwhile, recent data from RWA.xyz shows the market capitalization of tokenized real-world assets has already grown more than sevenfold since 2022, surpassing $20 billion today.

These numbers signal a profound change: markets traditionally reserved for institutions or insiders - like revenue-share bonds or tokenized private debt - are now becoming investable by a wider range of participants, giving investors direct exposure to new sources of yield and portfolio diversification.

But the opportunity goes beyond simply putting assets on a blockchain. Tokenization is pushing markets away from legacy systems weighed down by paper contracts, slow settlement, and costly intermediaries, toward blockchain-powered infrastructure where assets are programmable, ownership is transparent, and transactions, including settlement, happen in real time.

As adoption accelerates, one thing is clear: issuing more digital assets alone isn’t enough. The true potential of tokenization - deep liquidity, global accessibility, and seamless integration - depends on building networks where these assets can trade freely, interact with traditional and digital financial products, and move within a unified market ecosystem.

In this edition of The WIRE, we explore why tokenization isn’t just digitization, what needs to happen for tokenized markets to deliver on their promise, and real-world examples already demonstrating both the progress made and the work ahead.

To dive deeper, download our latest whitepaper on tokenization for a comprehensive analysis of the opportunities and challenges in this rapidly evolving space.

What are the challenges in today’s capital markets

For decades, traditional capital markets have been defined by structural inefficiencies that raise costs, limit access, and slow progress, keeping many investors on the sidelines.

1. Slow, complex processes: Buying or selling assets like real estate or private equity often takes weeks of paperwork, back-and-forth negotiations, and approvals from multiple intermediaries, wasting time and eroding returns.
2. Limited access: High investment minimums and accreditation requirements lock out most investors, confining opportunities in private markets to a small circle of institutions and the ultra-wealthy.
3. Opaque ownership: Layers of brokers and custodians obscure who truly owns what, adding uncertainty, complexity, significant costs and risk for investors.
4. Manual, slow settlement: Custody and settlement rely on outdated systems with T+2 (or longer) timelines, tying up investor capital and preventing quick reinvestment.
5. Illiquidity: Assets like private equity stakes, art, or property often force all-or-nothing sales, offering no easy way for investors to unlock partial liquidity or exit flexibly.
6. High costs and friction: Settlement delays, manual processes, and intermediary fees erode value and tie up capital that could be used more productively.
7. Legacy infrastructure: Traditional systems are fragmented and siloed, lacking the real-time connectivity needed in today’s global economy.

These problems raise costs, hinder market growth, and exclude broad investor participation. They block access to unique opportunities, reduce efficiency, and limit the ability to diversify into promising assets.

Beyond digitization: How tokenization redefines ownership

Tokenization goes far beyond digitization. By turning assets into programmable, blockchain-native tokens, tokenization changes how ownership works at its core:

1. Programmable assets: Tokenized assets can embed rules directly into smart contracts, automating payments, distributions, and compliance checks without manual intervention.
2. Direct ownership: Investors can hold tokens representing fractions of assets directly in their wallets, eliminating layers of custodians and brokers and clarifying who owns what in real time.
3. Instant settlement: Instead of waiting days or weeks, transactions can settle in minutes or seconds, freeing up capital for both issuers and investors.
4. Global access: Tokenized assets can be offered to a broader pool of investors worldwide, enabling issuers to reach beyond their local markets and investors to diversify into previously inaccessible asset classes.

For investors, this means unprecedented flexibility, greater transparency, and more opportunities to participate in high-quality assets traditionally out of reach, all with faster execution and fewer middlemen.

From Tokenization 1.0 to 2.0: Moving beyond islands

The first wave of tokenization showed that assets like bonds, real estate, and treasuries could be represented digitally. But many early projects created isolated silos  -  tokens stuck on a single platform with limited liquidity and investor access. As experts note, “When tokenized assets are shackled within individual silos, they’re rendered stagnant,” simply replicating old inefficiencies in digital form.

The next phase, Tokenization 2.0, must transform these islands into an integrated ecosystem. Tokenized assets need to move seamlessly across platforms, interact with other financial products, and connect with traditional finance to deliver on promises like 24/7 trading and instant settlement.

Building this requires:

1. Interoperability standards: Protocols like ERC-3643 ( a token standard on the Ethereum blockchain designed specifically for permissioned tokenized assets) let assets trade across venues without custom integrations.
2. Composability: Tokens must integrate with DeFi and other financial apps, enabling use as collateral or in index products.
3. Bridges to traditional finance: Connections to established custody, settlement, and compliance systems are key to building trust and unlocking institutional capital.

As the World Economic Forum noted in 2025, convergence between digital and traditional finance offers “unprecedented efficiency, liquidity, and interoperability.” But this vision will only materialize if isolated token islands become part of a unified market.

Real deals, real impact: Proof points in motion

Investors no longer have to imagine the promise of tokenization - it’s already delivering real opportunities to access assets once off-limits:

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Real deals, real impact: Proof points in motion

These cases prove tokenization’s power to bring unique, yield-generating, or diversifying assets to investors, but also show that unlocking full investor value requires connecting these tokens to integrated, liquid markets.

The next big opportunity: Integrated, liquid markets

The real promise of tokenization lies in moving beyond isolated assets to integrated, liquid markets. Investors will benefit when tokenized stocks, bonds, and private assets can trade alongside traditional securities in unified marketplaces with active secondary trading, collateral mobility, and composability with DeFi and other financial applications.

As interoperability standards, regulatory clarity, and custodial solutions advance, tokenized assets will become as practical and attractive as traditional assets,  but with advantages like 24/7 markets, programmable compliance, and transparent ownership.

What investors should prioritize now

For investors ready to harness these opportunities, focus on:

1. Liquidity and interoperability: Seek assets designed for circulation across platforms, maximizing your ability to buy, sell, and use them as markets mature.
2. Compliance-ready standards: Favor tokens issued with protocols like ERC-3643, ensuring they meet global regulatory requirements and integrate seamlessly across venues.
3. Trusted custody and bridges: Prioritize offerings with secure custody and settlement infrastructure that connect tokenized assets to traditional capital markets, a critical factor in making them reliable, tradable parts of your portfolio.

For the first time, people anywhere in the world can hold a piece of a tokenized stock or bond as easily as cash - able to send it, save it, spend it, or use it as collateral, all from their wallet, instantly and without borders or intermediaries. Tokenization is leveling the playing field, giving anyone with a smartphone a way to participate in global wealth creation: to invest and build financial security.