A decade of experiments has given way to production systems. Banks issue tokenized deposits and funds, broker‑dealers pilot on‑chain treasuries, and exchanges explore tokenized listings and 24/7 settlement. The premise is simple: put records, settlement, and controls on neutral rails so assets move with fewer intermediaries, fewer reconciliation breaks, and programmatic controls that auditors can verify. This isn’t about replacing finance overnight; it’s about upgrading the plumbing while keeping guardrails investors expect.
Skeptics argue DeFi will eventually absorb TradFi altogether; see our forward‑looking roundtable, Bitcoin 2025: Builders predict DeFi will unseat traditional finance. In practice, 2025 shows convergence: regulated institutions adopt blockchain features while crypto rails adopt compliance and transparency familiar to institutions.
Tokenisation maps real‑world assets (RWAs) into programmable units with verifiable ownership and rules. The common patterns:
Treasuries and money‑market fund shares. Institutions issue tokens that represent claims on short‑dated government paper or fund shares. Transfers settle on‑chain while the underlying assets remain with a custodian; redemptions follow fund rules. Daily NAV and reserve attestations make tokens traceable.
Corporate bonds. Issuers place bonds on chain with coupon schedules encoded into smart contracts. Corporate actions (coupons, amortisation, redemptions) trigger automatically, cutting back‑office work and settlement friction.
Equities and structured products. Tokenised depositary receipts or structured notes trade peer‑to‑peer on permissioned or public chains, with issuer/regulator whitelists. The payoff logic (caps, barriers, autocalls) is transparent in code.
Commodities and inventories. Warehouse receipts and gold bars get serialised on chain. Tokens can embed assay data and custody location, enabling faster collateral mobility and real‑time audit trails.
Across all categories, compliance is baked in: whitelists for KYC’d investors, transfer restrictions that reflect prospectus rules, and oracles that pause transfers when conditions aren’t met (e.g., sanctions or trading halts).
Nasdaq — Beyond listing markets, Nasdaq sells market‑infrastructure tech to exchanges, CSDs, and banks. Its post‑trade platforms increasingly explore DLT‑based ledgers for real‑time reconciliation, collateral mobility, and corporate‑actions automation. The goal: fewer breaks, faster close, and better transparency across participants.
Coinbase — As a US‑regulated crypto firm with an institutional custody arm, Coinbase has become a key tokenisation and settlement partner for asset managers and fintechs. Its role typically spans qualified custody, on‑chain issuance support, and connectivity to public networks alongside traditional reporting.
Gemini — A New‑York‑chartered trust company that pioneered regulated stablecoin and custody services used by institutions for on‑/off‑ramps and treasury management. Gemini’s experience with trust‑grade controls, SOC reports, and segregated custody makes it a familiar counterparty to compliance teams.
These examples illustrate a pattern: traditional players provide rule‑sets and investors; crypto‑native firms provide issuance, custody, and on‑chain connectivity. Together they create instruments with traditional wrappers and programmable settlement.
T+instant settlement & fewer breaks. Atomic delivery‑versus‑payment (DvP) reduces counterparty and settlement risk while shrinking margin requirements and capital tied up in pending trades.
Programmable compliance. Transfer rules, lockups, and eligibility are enforced by code; auditors can replay state to verify that policies were followed.
24/7 markets with composability. Tokens plug into lending, repo, and collateral marketplaces automatically. Treasury teams can optimise cash via smart contracts instead of email chains.
Granular transparency. On‑chain fund shares and notes can publish proofs of reserve, holdings snapshots, and real‑time flows that investors can independently check.
Operational savings. Corporate actions, reconciliations, and reporting collapse into event‑driven workflows, cutting manual effort and error rates.
Institutional allocators are taking notice: dedicated funds now target enterprise blockchain adoption, like dao5’s $222M fund to back institutional blockchain adoption—evidence that capital is following use‑cases, not just narratives.
Legal finality & enforceability. Jurisdictions must recognise on‑chain records as books‑and‑records and clarify which ledger is the system of record when disputes arise.
Custody and segregation. Qualified custodians need standards for key management, cold‑storage percentages, insurance, and how rehypothecation (if any) is disclosed.
Market structure. Tokenised assets raise questions about transfer restrictions, secondary trading venues, and investor eligibility across borders. Fragmented rules can trap liquidity in pockets.
Oracles & data integrity. If coupons, NAVs, or reserves are wrong, code will enforce the wrong thing faster. Independent attestations and diversified oracles are mandatory.
Operational risk. Key loss, smart‑contract bugs, and dependence on a single service provider can create new single points of failure if not mitigated.
Cultural resistance. Risk, legal, and audit teams must get comfortable with new controls. Change management—not just code—is the bottleneck.
Regulators and policymakers are probing deeper. If blockchain rails go mainstream, would people still rely on governments for the guarantees markets depend on? Our essay Would people still rely on governments if crypto and blockchain adoption goes mainstream? explores that tension.
Expect hybrid stacks to dominate: permissioned ledgers and qualified custodians for issuance and primary distribution; bridges and public chains for liquidity and composability. Stablecoin rules will harden, enabling on‑chain cash as reliable settlement collateral. Corporate treasuries will adopt tokenised cash management: sweep policies encoded in contracts that allocate between bank accounts, MMFs, and on‑chain repos based on intraday needs.
We’ll also see better identity and attestations—portable KYC and transaction provenance that let assets move across venues without re‑papering every hop. And as tools mature, expect “DeFi‑style” experiences with institutional guardrails: risk dashboards, pre‑trade controls, timelocks, and automated reporting that satisfy both portfolio managers and auditors.
Traditional finance isn’t abandoning its playbook; it’s extending it. Tokenisation and on‑chain settlement bring speed and transparency to familiar instruments, while compliance and governance keep investor protections intact. The winners in 2025–2026 will be the teams that ship boring reliability first—clear rules, clean audits, and smooth integrations—and then scale into new products the market already understands.
Further reading: institutional perspectives on the coming shift (DeFi vs TradFi in 2025), capital formation for enterprise adoption (dao5’s $222M fund), and a policy lens on governments’ role as crypto adoption grows.
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