Tokenization will disrupt finance faster than digital disrupted media: Crypto exec

According to Keith Grossman, president of crypto payments company MoonPay, tokenization will transform the financial sector faster than digital technology, such as printed newspapers, physical copies of music and other analog formats.

“While many feared that digitalization would destroy media, it actually forced its evolution,” Grossman said saidadding that real-world asset (RWA) tokenization, the process of representing traditional assets on-chain, will force traditional institutions to adapt. He added:

“This is no longer hypothetical. BlackRock offers tokenized funds. Franklin Templeton manages tokenized money market funds on public blockchains. Major global banks are testing onchain settlement, tokenized deposits and real-time asset movements.”

Financial incumbents like Citi, Bank of America, JPMorgan Chase and others will continue to exist in a different form, Grossman said, just as media companies continued to exist after the shift to digital distribution in the late 1990s and early 2000s, which disrupted business models that had worked for decades.

Ultimately, the survivors and winners of the ongoing shift to tokenized finance will be the companies that get ahead of the change and not those that try to stop the inevitable shift to a global financial system powered by blockchain rails, he said.

Related: Wall Street’s $4 trillion backbone to roll out tokenized US Treasuries

Why tokenized assets can change the game

Tokenizing real-world assets has several benefits, including enabling 24/7 access to markets, making asset classes global, cheaper transaction costs through disintermediation, and reducing settlement times to minutes instead of days.

In September, the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) issued a joint statement on creating a regulatory framework to enable 24/7 capital markets.

The financial system’s shift to 24/7 trading represents a major departure from the way traditional markets, which are closed on evenings, weekends and holidays, currently function.

In December, the Depository Trust and Clearing Corporation (DTCC), a settlement and clearing company that will process approximately $3.7 trillion in settlement volume by 2024, received approval from the SEC to offer tokenized financial instruments.

The DTCC plans to roll out tokenized assets in the second half of 2026, starting with US government bonds and stock indices.

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