Photo by Kanchanara on Unsplash
On 8 September, a news item flashed across my iPhone. It was that the Nasdaq stock exchange had applied to the SEC for permission to tokenise all the stocks listed on its exchange. Tokenisation of real-world assets has been around for a good few years, with most commentators saying — yeah, it’s going to be big one day — and then returning their attention to Bitcoin and stablecoins, the two big stories hogging the headlines for the past 18 months.
Let’s put this in perspective: Nasdaq-listed assets are cumulatively worth $63 trillion. Currently, the entire crypto market is worth $4 trillion. The tokenisation business is going to be orders of magnitude larger than the rest of the crypto market put together.
Most of us with an interest in this sector know that the SEC has become crypto-sympathetic (or at least not crypto-allergic) since Trump appointed a slew of true believers to replace SEC Chairman Gensler and his regulatory henchmen. One can only assume that the SEC will give approval to Nasdaq, sooner or later. And then the walls will come down. Everyone will follow. Other US and global exchanges — stock, futures, commodities, options. Why? Because tokenised exchange products on a blockchain are simply a better mousetrap than the ancien régime of middlemen and paperwork and arcane regulations and process sludge that currently holds sway in traditional finance. No one will be able to resist its charms for long.
This brings us to the other blockchain: Ethereum.
Ethereum has struggled to get much airtime in the general financial press, except from specialists. It has been a side story, one that is generally poorly understood. But the approval of Nasdaq tokenisation will supercharge Ethereum and its native token, ETH.
Ethereum was conceived and developed in 2014 by Vitalik Buterin (then a teenager) in reaction to the Bitcoin blockchain’s focused architecture, which was optimised to act as a harness for its cryptocurrency (confusingly, both the blockchain and the cryptocurrency that resides on it are called Bitcoin). The blockchain is now and will forever be a harness for its cryptocurrency. It does little else, by design and intent.
Vitalik’s big idea was that a blockchain is, in fact, a special sort of general-purpose computer and should be able to do whatever people want it to do. So he designed a programming language, put it on top of the blockchain, and released it to the world. And lo and behold, developers started using Ethereum to code unique applications for all manner of things, from NFTs to prediction markets to decentralised crypto exchanges and secure file systems — including this new rising giant: tokens that represent ownership of some fraction of real-world assets.
The story is a little more complicated, as is normally the case. There are multiple competitors to Ethereum that arose to allow programs to be written for blockchain apps. But therein lies Ethereum’s genius. Firstly, they released their most important development environment into the world, gratis (called the EVM). Direct competitors could either choose to start building tools from scratch or use the EVM ecosystem, bristling with hardened and useful components. They obviously chose the latter — it was the fastest route to market.
And then they said to other aspirants — feel free to write your own apps on your own blockchains, but we would be happy to secure the transactions for you very inexpensively. This saved app developers from the risky work of developing security, and most took the offer.
The result: almost every programmable blockchain in the world is beholden to Ethereum in some way. The adoption of Ethereum’s toolkit of development tools and security apparatus has served to strengthen their offerings whilst at the same time strengthening Ethereum’s grip.
This has brought Ethereum to this point:
It is the second-largest blockchain by value (currently around $500 billion). It hosts the largest number of applications of any blockchain. It has by far the largest developer ecosystem. It has the largest toolset for developers, developed by both them and their competitors, which has acted as a ‘flywheel’ for the larger Ethereum developer ecosystem. It has the most recognisable brand behind Bitcoin. It has a deep and mature roadmap into the future.
It is the OG of programmable public blockchains — perhaps not as inexpensive to transact on as others, perhaps not quite as fast to settle a transaction, but the wise and generous elder, the last common ancestor of application-centric blockchains.
The numbers tell the story: Ethereum (and other EVM ecosystems) hosts 95% of stablecoins, 78% of tokenised gold, 87% of tokenised treasuries, and 79% of the still-nascent real-world asset market. The big booster (stocks, commodities, and their derivatives) is yet to begin.
And it is on fire, with ETH’s value having increased from $1,067 in June 2022 to about $4,500 at the time of writing, with many analysts now whispering about $10,000.
In 2024, the SEC supercharged Bitcoin by approving the first Bitcoin ETF, most notably led by giant asset manager BlackRock.
It looks like it is Ethereum’s time to step into the spotlight.
Steven Boykey Sidley is a professor of practice at JBS, University of Johannesburg and a partner at Bridge Capital. His new book “It’s Mine: How the Crypto Industry is Redefining Ownership” is published by Maverick451 in SA and Legend Times Group in UK/EU, available now. His columns can be found at
Originally published at https://stevenboykeysidley.substack.com.
The Other Blockchain was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.
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