Yasuda on Tokenization

The Commodity Futures Trading Commission (CFTC) announced on February 7, 2025, a pilot program to explore the use of tokenized non-cash collateral, including stablecoins, in regulated derivatives markets. This initiative aims to assess the feasibility and implications of integrating digital assets as collateral in trading and clearing activities. To facilitate this, the CFTC will host a CEO Forum with industry leaders from companies such as Circle, Coinbase, Crypto.com, MoonPay, and Ripple. Further details about the forum will be released once finalized.

Industry participants have expressed optimism about this development. Nadine Chakar, Global Head of DTCC Digital Assets, highlighted the potential to “increase the velocity of collateral in the marketplace without any changes to rules and guidance.” Chris Zuehlke of DRW noted the benefits of real-time settlement capabilities, stating that it enhances risk management processes. These perspectives underscore the industry’s support for integrating distributed ledger technology to enhance market efficiency.

At the inaugural Ondo Summit in New York City, executives from leading financial institutions highlighted the transformative potential of blockchain technology in modernizing financial markets. Raj Dhamodharan, Mastercard’s Executive Vice President of Digital Asset and Blockchain Products, introduced the Multi-Token Network (MTN), emphasizing its role in facilitating secure and efficient transactions by integrating bank deposits and stablecoins. He stated, “End of the day, this is about platform building, building platforms, scalable platforms, takes time, and the right building blocks need to be in place.”  

Ryan Rugg, Citi’s Global Head of Digital Assets, discussed the bank’s Citi Token Services, designed to enable instantaneous, 24/7 cross-border transfers for corporate clients. She noted, “The pain point that we were trying to solve for was… the ability to move money instantaneously 24/7 on a 365 basis is really what our corporates wanted.” Caroline Butler, BNY Mellon’s CEO of Custody Services, emphasized the bank’s commitment to leveraging blockchain for asset custody and settlement, stating, “We fundamentally believe that blockchain technologies… are the technologies of the future to break some of the issues that exist in the market structure.”

Security Token Market (STM) has released a report forecasting that the tokenization of real-world assets (RWAs) could reach $30 trillion by 2030. This optimistic projection is based on the current momentum in tokenizing assets such as stocks, real estate, bonds, and gold. The report emphasizes the role of regulatory clarity and the increasing adoption of blockchain technology by major financial institutions as key drivers of this growth.

STM’s forecast is notably more optimistic than those of other consulting firms. For instance, McKinsey & Company estimates the tokenized asset market will be less than $2 trillion by 2030, while Boston Consulting Group (BCG) projects it could reach $600 billion. STM attributes its higher projection to factors such as recent regulatory advancements, the rapid integration of blockchain technology in financial services, and the accelerating pace of asset tokenization initiatives. The firm believes that sectors like stocks, real estate, bonds, and commodities will be the primary drivers of this anticipated growth.

Swiss luxury jewelry brands are increasingly adopting blockchain technology to enhance transparency and authenticity in the diamond market. By tokenizing diamonds, these brands create digital representations of each gemstone on a blockchain, ensuring secure and immutable records of provenance, dimensions, and ownership. This approach allows buyers to own, verify, and trade diamonds digitally without possessing the physical gemstone, streamlining transactions and bolstering consumer confidence.  

A notable example is the collaboration between Swisstronik, Van der Bauwede, and Swiss Diamond Lab. Together, they have launched an Asset Tokenization Suite that tokenizes synthetic diamonds, securely storing each diamond’s details on the blockchain. This system not only ensures full traceability and authenticity but also grants buyers the right to redeem the physical diamond upon production completion. Additionally, a dedicated platform allows clients to pre-order tokenized diamonds at discounted rates, providing early capital inflow and valuable market demand insights for producers. This initiative exemplifies how legacy industries can adopt blockchain tools to create verifiable, efficient, and compliant markets for luxury goods.