How Asset Tokenization Unlocks Trillions by 2030: What the Experts Say

How Blockchain Supports Asset Tokenization

Blockchain provides the infrastructure used to issue, transfer, and track tokenized assets.

Its main benefits include:

• Transparency: Transactions recorded onchain can be tracked and verified.
• Fractional ownership: High-value assets can be divided into smaller units.
• Automation: Smart contracts can automate transfers and other processes.
• Faster settlement: Blockchain systems may reduce the time required to complete transactions.
• Lower costs: Automation can reduce reliance on some intermediaries.
• Security: Blockchain records are designed to be difficult to alter after transactions are confirmed.

These features could make traditionally illiquid assets easier to access and trade.

Financial Institutions Are Already Testing Tokenization

Asset tokenization is no longer only a theoretical idea. Major financial institutions are already experimenting with blockchain-based assets.

Legal & General, which manages about $1.5 trillion in assets, has explored tokenizing funds backed by U.S. Treasuries.

The company has worked with blockchain technology since 2019, including using Amazon's managed blockchain infrastructure for bulk annuity operations.

Swiss banks are also increasing their exposure to the sector. About 48% of Swiss banks were planning or conducting tokenization projects, while 64% were already involved with cryptocurrencies.

DBS Bank in Singapore has also launched DBS Token Services for institutional clients.

The platform uses an EVM-compatible blockchain and smart contracts to support areas such as liquidity management and transaction automation.

Meanwhile, Movement Labs joined the ERC-3643 Association to support compliant real-world asset tokenization. Its planned integration would bring the ERC-3643 standard to the Movement Network.

How Large Could the Tokenized Asset Market Become?

Forecasts vary widely.

McKinsey estimates tokenized assets could reach roughly $2 trillion by 2030 under its base-case scenario and around $4 trillion under a more optimistic scenario.

Standard Chartered and Synpulse have projected that tokenized real-world assets could reach between $16 trillion and $30 trillion by 2030-2034.

Boston Consulting Group and ADDX have also estimated that asset tokenization could reach $16.1 trillion by 2030, representing roughly 10% of global GDP.

Potential markets extend beyond traditional securities. RBN Energy, for example, estimates that mineral and royalty interests alone represent a market worth about $700 billion.

Tokenization Could Improve Asset Liquidity

One of the biggest potential benefits of tokenization is improved liquidity.

Many assets, including real estate, private equity, and fine art, can be difficult to sell quickly. Tokenization allows these assets to be divided into smaller units that may be easier to trade.

As of October 2024, tokenized assets tracked onchain had reached about $13.3 billion.

Fractional ownership can also lower entry barriers. Instead of committing large amounts of capital to one asset, investors may be able to purchase smaller positions.

However, tokenization does not automatically guarantee liquidity. A token still needs buyers, sellers, trading infrastructure, and clear legal rights before an active secondary market can develop.

Smart Contracts Could Simplify Asset Transfers

Tokenization can also make asset transfers more efficient.

Smart contracts can automate tasks such as:

• Ownership transfers
• Settlement
• Compliance checks
• Distribution of payments
• Collateral management

BlackRock's BUIDL token is one example of tokenized financial assets being used beyond simple ownership representation.

BUIDL has been positioned for use as collateral in crypto derivatives trading on platforms including Binance and Deribit.

This shows how tokenized assets may connect traditional financial instruments with blockchain-based markets.

Regulation Remains a Major Challenge

Despite its potential, real-world asset tokenization faces significant regulatory hurdles.

Tokenized assets can fall under existing securities, property, tax, and anti-money laundering laws. Rules also vary between jurisdictions.

That creates several challenges:

• Determining the legal status of tokenized assets
• Confirming who legally owns the underlying asset
• Meeting KYC and AML requirements
• Supporting cross-border transactions
• Protecting investors
• Ensuring tokens can legally represent real-world ownership

Regulators in the United States, European Union, Singapore, Switzerland, the UK, and Hong Kong have taken different approaches to digital assets and tokenization.

Some jurisdictions have also introduced regulatory sandboxes that allow companies to test blockchain products under controlled conditions.

Clear rules will be important if tokenization is to move beyond pilot programs and reach mainstream financial markets.

How Asset Tokenization Could Change Asset Management

Tokenization could give asset managers more flexibility when building portfolios.

Instead of treating an asset as one indivisible investment, managers could divide it into smaller digital units.

Potential advantages include:

• Lower investment minimums: Investors may access assets that previously required large amounts of capital.
• More flexible portfolios: Smaller units allow more precise asset allocation.
• Broader distribution: Tokenized assets may reach investors across more markets.
• Faster processes: Automation can simplify issuance, settlement, and reporting.
• Greater transparency: Onchain records may improve visibility into transactions.

This could be especially important for markets such as real estate, private equity, bonds, commodities, and other traditionally less liquid assets.

Financial Firms Will Need New Skills and Infrastructure

Tokenization also creates operational challenges.

Financial companies entering the market may need specialists in:

• Blockchain technology
• Cybersecurity
• Smart contracts
• Digital asset custody
• Regulatory compliance
• Tokenized asset management

Institutions may also need to upgrade their technology systems to securely issue, store, transfer, and monitor blockchain-based assets.

Education will become increasingly important as traditional finance and blockchain infrastructure become more closely connected.