For pension funds, tokenization’s real play is balance sheet management, not just 24/7 liquidity, Fidelity’s Lai says

Share This Post

Tokenized products already exist, though mainly for investing. The most popular category is tokenized money market funds, primarily backed by U.S. Treasuries. The largest, BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), debuted in March 2024.

This category now has more than $15 billion of assets under management (AUM), with the broader onchain real-world asset market (excluding stablecoins) surpassing $31 billion in value. Casting a wider net to include assets such as alternative investments and tokenized financial infrastructures, the global asset tokenization market is valued at roughly $2.1 trillion.

According to forecasts by Grand View Research, the sector is projected to hit $24.5 trillion by 2033, with some industry estimates suggesting tokenized markets could reach as much as $88 trillion by 2035.

The key advantage they offer is instant execution around the clock and fractional ownership, which allows traders to buy small portions at any time, with all stages of the transaction — including purchase, sale and final processing — completed immediately.

Faster, cheaper

That’s not the focal point for institutional investors, who are more interested in the properties of the tokenized assets than their ease of trading.

“Generally speaking, they are not asking for tokens,” Lai said. “They are asking for what tokens can do more compared to the existing wrappers they already have.”

Related Posts

Tokenized assets are busier than the data shows

When you strip out what was never mobile, correct...

The Clarity Act slipped to September. Banks are building anyway

But every month without settled rules quietly rewards the...

Fed Chair Kevin Warsh at Jackson Hole: 'We have work to do' on inflation

Warsh's highly anticipated remarks at the Kansas City Fed's...

Bitcoin wallets untouched for 10 years moved $40 million. Most avoided exchanges

Six decade-old wallets moved $40 million this month, but...