Tokenized products already exist, although primarily for investment. The most popular category is tokenized money market funds, which are primarily backed by the U.S. Treasury. The largest BlackRock USD Institutional Digital Liquidity Fund (BUIDL) debuted in March 2024.
The category currently has over $15 billion in assets under management (AUM), and the broader on-chain real-world asset market (excluding stablecoins) is worth over $31 billion. Casting a wider net to include assets such as alternative investments and tokenized financial infrastructure, the global asset tokenization market is valued at approximately $2.1 trillion.
The size of the sector is expected to reach $24.5 trillion by 2033, according to projections by Grand View Research, and some industry estimates suggest the tokenization market could reach $88 trillion by 2035.
The main benefits they offer are 24-hour instant execution and fractional ownership. This allows traders to buy small amounts at any time, and all stages of the trade, including purchase, sale, and finalization, are completed instantly.
faster and cheaper
For institutional investors, that is not the focus, they are more interested in the nature of the tokenized asset than the ease of trading.
“Generally speaking, they don’t want tokens,” Lai said. “They are asking which tokens can do more compared to the existing wrappers they already have.”
