Wall Street goes on-chain: BlackRock, DTCC, and NYSE ignite the tokenization revolution

Early institutional adoption of tokenization was marked by pioneering moves from major financial players such as NASDAQ and BlackRock, signaling a shift from theoretical exploration to practical implementation. NASDAQ’s SEC filing to list tokenized securities and BlackRock’s recognition of tokenization alongside Bitcoin as a major secular theme underscored growing confidence in blockchain’s role within traditional finance. This momentum was further exemplified by Figure’s IPO, which issued $12 billion on-chain and dramatically reduced loan processing times from the industry average of 40 days to just 10, showcasing operational efficiencies and compliant token sales that set new industry benchmarks.

Institutional pilot projects have evolved beyond isolated experiments into integrated frameworks that bridge traditional finance and blockchain infrastructure. Notably, Coinbase’s launch of Token Launches introduced a compliant platform enabling retail participation in early token sales with behavior-based allocation to mitigate market manipulation, while DBS and J.P. Morgan’s Kinexys developed cross-bank tokenized deposit systems operating seamlessly across permissioned and public blockchains, enabling real-time, 24/7 settlement without traditional intermediaries. Franklin Templeton’s expansion of its Benji Technology Platform onto the Canton Network, moving nearly $800 million in assets under management, further exemplifies how foundational technology upgrades are facilitating confidential, compliant institutional tokenization.

The Depository Trust & Clearing Corporation (DTCC) has been a central figure in advancing institutional tokenization through regulatory-approved pilot programs and strategic partnerships. Receiving SEC approval for a three-year pilot to tokenize U.S. capital market securities on Ethereum and partnering with the Canton Network to tokenize U.S. Treasuries, DTCC is pioneering the integration of blockchain into traditional securities infrastructure. These initiatives have progressed into production trades, including repurchase agreements settled with stablecoins, signaling a transition from concept to operational reality and setting the stage for broader adoption with planned platform launches in 2026.

Early institutional tokenization efforts have been bolstered by companies like Securitize and Figure, which have combined regulatory compliance with innovative blockchain infrastructure to scale tokenized asset management. Securitize, managing $4.6 billion in tokenized assets and operating as a registered transfer agent and broker-dealer, has established foundational standards for compliant native tokenization across multiple blockchains including Polygon, Avalanche, Ethereum, and Solana. Meanwhile, Figure’s vertically integrated platform, including its proprietary Providence blockchain and On-chain Public Equity Network (OPEN), has demonstrated substantial cost reductions and efficiency gains in loan origination and equity trading, evidencing how pilot projects are evolving into scalable institutional solutions.

The passage of the Genius Act in mid-2025 marked a pivotal regulatory milestone in the U.S. by establishing a federal licensing regime for stablecoin issuers that mandates 100% reserves and removes stablecoins from SEC jurisdiction, thereby significantly reducing legal uncertainty. BlackRock’s strategic adaptation of its 2A7 money market funds to comply with the Genius Act exemplifies how regulatory frameworks are enabling traditional finance giants to back stablecoins like USDC, boosting institutional confidence and accelerating tokenization efforts. This regulatory clarity, coupled with SEC 2A7 guidelines, has been instrumental in overcoming longstanding compliance roadblocks that previously hindered large-scale tokenization of real-world assets.

2025 emerged as a watershed year for institutional tokenization, highlighted by BlackRock’s entry into tokenized products, which Carlos Domingo of Securitize describes as the moment the industry’s eyes truly opened. This shift from stablecoins as a 'Trojan Horse' to tokenized treasuries and public equities reflects growing regulatory acceptance and compliance maturity, with the SEC’s issuance of a No-Action Letter to DTCC’s subsidiary authorizing tokenization services for real-world assets further cementing this progress. These developments not only reduce legal uncertainty but also unlock liquidity by enabling shares trapped in legacy DTCC databases to be freed onto blockchains, signaling a new era of institutional adoption and market innovation.

Regulatory clarity has evolved beyond mere legal frameworks to become a catalyst for operational innovation and broader market participation. Securitize’s journey as a registered transfer agent and broker-dealer illustrates how native tokenization—where tokens represent exact rights of underlying securities without derivatives—addresses both compliance and fungibility challenges, thereby attracting asset managers who previously shied away from the regulatory complexities of retail offerings. Moreover, the SEC’s explicit guidance endorsing the use of public blockchains for transfer agents and broker-dealers has dramatically lowered barriers, enabling a surge in institutional interest to issue IPO shares on-chain and distribute tokenized allocations to crypto-savvy retail investors.

By early 2026, a global convergence of regulatory frameworks—including the EU’s MiCA, Hong Kong’s alignment with Singaporean standards, and the anticipated U.S. Clarity Act—has effectively eliminated the excuse of waiting for regulatory clarity, empowering banks, asset managers, and fintechs to execute tokenization initiatives with confidence. Pilot programs led by institutions like the Bank of Canada and Franklin Templeton demonstrate how jurisdiction-specific compliance adaptations and licenses, such as SEC transfer agent approvals, enable seamless on-chain updating of cap tables and atomic settlement. These regulatory advances are not mere overlays but foundational replacements for legacy capital market infrastructure, embedding compliance and operational efficiencies that unlock 24/7 borderless trading and vastly increase capital velocity.

By late 2025, institutional players like DBS and J.P. Morgan’s Kinexys pioneered cross-bank frameworks that seamlessly bridge permissioned and public blockchains such as Base and Ethereum Layer 2, enabling real-time, 24/7 settlement without reliance on traditional intermediaries like SWIFT. Simultaneously, Franklin Templeton’s expansion of its Benji Technology Platform onto the Canton Network underscored the critical importance of privacy and authorization in institutional blockchain infrastructure, leveraging the Daml protocol and Private Contract Stores to maintain confidentiality while ensuring compliance.

Ethereum’s 2025 'Fusaka' upgrade marked a significant leap in scalability by increasing BLOB capacity eightfold and optimizing Layer 1 and Layer 2 interactions through the 'Peer dos' proposal, drastically reducing transaction costs and latency. This momentum toward scaling continued with the planned 2026 'Glamsterdam' update, reflecting Vitalik Buterin’s vision of Ethereum as a 'super global computer' capable of handling surges in institutional activity, a view echoed by BlackRock’s Larry Fink who publicly endorsed tokenization’s transformative potential for mainstream finance.

Avalanche’s institutional strategy exemplifies a pragmatic fusion of traditional finance expertise and blockchain innovation, focusing on real-world asset tokenization and credit market automation rather than speculative use cases. Through trusted advisor relationships with banks and asset managers, Avalabs supports initiatives like Dinori’s tokenized equities platform, enabling atomic swaps of shares via DeFi primitives and embedding credit facility terms into NFTs to streamline private credit operations—thus lowering operational barriers for smaller funds and emerging managers.

The emergence of ERC 3643 as a permission token standard tailored for institutional needs has been a watershed development, with over $35 billion in assets implemented across 23 jurisdictions, including regulatory approvals from the SEC’s innovation exemption and Germany’s EPG. Supported by a nonprofit association boasting 140 institutional members, ERC 3643 addresses critical regulatory demands for identity, control, and compliance on-chain, reinforcing Ethereum’s role as the battle-tested backbone for institutional tokenization amid a broader shift from private permissioned blockchains to hybrid and public Layer 2 solutions favored for their transparency and liquidity.

By early 2026, Canton’s blockchain architecture illustrated a nuanced balance between decentralization and regulatory compliance, employing 'super validators'—recognized institutional entities—to uphold permissioned models that align with U.S. legal restrictions on bearer equity tokens. This approach reflects a broader industry trend of leveraging blockchain technology to upgrade legacy financial systems pragmatically rather than pursuing purely ideological decentralization, a philosophy echoed by Canton’s team and exemplified by Coinbase’s system upgrade ethos.

BlackRock’s 2026 endorsement of Ethereum as the foundational infrastructure for Wall Street’s tokenization efforts signals a strategic pivot toward public blockchains, recognizing Ethereum’s unparalleled security, developer ecosystem, and regulatory resilience. This endorsement cements Ethereum’s evolution from a speculative asset to the institutional crypto rails underpinning mainstream capital markets, accelerating the convergence of traditional finance with public blockchain networks.

BitGo is spearheading next-generation crypto infrastructure by integrating AI with tokenization, democratizing financial application development to the extent that, as Anthropic’s CEO predicted at Davos, software engineering may soon be replaced by AI-driven creation. BitGo’s global platform offers low-cost APIs and comprehensive financial services, enabling rapid onboarding and supporting a platformization of the financial stack where real-world and digital assets coexist as first-class citizens, enhancing scalability, security, and usability for institutional tokenization.

Evolving beyond custody, BitGo is building layered services such as settlement networks and trading functionalities atop its infrastructure, targeting the vast market of tokenized securities which dwarfs crypto-native assets in market cap. This infrastructure standardizes and simplifies the transfer and settlement of complex real-world assets—ranging from agricultural futures to financial products—eliminating intermediaries and fostering transparency, thus enabling seamless integration with broader crypto ecosystems.

Zero knowledge proofs have emerged as a pivotal innovation enabling private enterprise blockchains to maintain confidentiality while interoperating trustlessly via Ethereum’s shared settlement layer, overcoming the privacy limitations that hindered earlier consortium blockchains like Hyperledger and Corda. Matter Labs has been instrumental in advancing this technology, collaborating with Deutsche Bank, UBS, and over 35 global financial institutions to embed incorruptibility and privacy into scalable blockchain solutions that integrate smoothly with real-world business processes.

Institutional infrastructure is further evolving with DTCC’s integration of Chainlink oracles into its collateral management platform, slated for Q4 2026, to enable near real-time valuation, margining, and settlement of tokenized collateral. This development, coupled with rising institutional interest in privacy-focused blockchains like Canton and Arc—backed by heavyweight investors such as BlackRock and Apollo—highlights privacy as a critical frontier in blockchain infrastructure innovation, promising enhanced automation and shared institutional utility.

The expansion of tokenized asset classes has accelerated dramatically from 2023 onward, with equities, bonds, treasuries, commodities, and credit products increasingly represented on blockchain platforms. Early concerns about tokenizing equities through traditional brokerages risking perpetuation of market issues have given way to innovative models like Dinori's atomic swaps and Figure Technologies’ On-chain Public Equity Network (OPEN), which enable direct ownership and 24/7 trading, reducing intermediaries and enhancing capital efficiency. Industry leaders such as BlackRock, JPMorgan, and Nasdaq are actively integrating tokenized securities into mainstream infrastructure, signaling a profound shift toward native blockchain capital markets that promise near-instant settlement and fractional ownership.

Tokenized fixed income and commodities have emerged as foundational pillars in the tokenization ecosystem, with tokenized US Treasuries surpassing $9 billion in assets and tokenized gold dominating commodity tokenization at over $7 billion market cap. Products like Franklin Templeton’s blockchain-based money market fund and Tether Gold’s XAUT token demonstrate institutional-grade compliance and liquidity, with tokenized gold volumes eclipsing traditional ETFs and serving as a digital safe haven during market stress. Despite regulatory and operational challenges, these asset classes are bridging traditional finance and DeFi, enabling 24/7 global access and fractional ownership previously unattainable in legacy markets.

The rise of new trading platforms and 24/7 markets is reshaping how tokenized securities are accessed and traded globally. Major exchanges like the NYSE and Nasdaq are developing blockchain-native platforms that support continuous trading, fractional shares, and on-chain settlement, leveraging existing market infrastructure while collaborating closely with regulators such as the SEC and FINRA. Meanwhile, crypto-native platforms like Ondo Finance and Kraken are expanding tokenized stock offerings to hundreds of thousands of users worldwide, integrating DeFi capabilities and enabling seamless cross-chain interoperability. This convergence is dissolving traditional market boundaries, allowing investors to trade and utilize tokenized assets in real time across both traditional and decentralized finance ecosystems.

Institutional adoption is deepening with tokenized credit markets surpassing $1.5 billion in loans outstanding and traditional finance increasingly accepting crypto collateral, notably Bitcoin, for credit products. Innovative collaborations, such as Valinor and Oati embedding loan terms into NFTs, automate credit facility management and reduce operational burdens, enabling smaller funds and family offices to participate. Concurrently, regulatory clarity and evolving compliance frameworks, including KYC enforcement by banks and SEC guidance, are fostering a more secure environment for tokenized securities, encouraging issuers to expand beyond simple tokenized Treasuries into a broader array of asset classes and driving the maturation of the tokenization ecosystem.

The institutional embrace of tokenization has accelerated dramatically, marked by pioneering initiatives from major players like BlackRock, DTCC, NYSE, Nasdaq, and JP Morgan. BlackRock’s successful launch of the $3 billion Bidd tokenized money market fund, coupled with its strategic partnership with Circle since 2022, underscores a paradigm shift where liquidity and yield capture coexist seamlessly through stablecoin integration. Meanwhile, DTCC’s multi-year pilots—including its groundbreaking SEC-approved tokenization of US Treasuries on the Canton Network and plans to launch a comprehensive tokenized securities platform by mid-2026—signal a tectonic move to embed blockchain into the core plumbing of American capital markets, processing over $114 trillion in assets. This institutional momentum is further amplified by NYSE’s development of a 24/7 tokenized equity trading platform aiming for near-instant settlement and fractional shares, and Nasdaq’s collaboration with Kraken to integrate regulated market infrastructure with programmable digital assets, enabling equities to operate continuously and interact with DeFi applications.

Layer 1 and Layer 2 blockchain infrastructure, particularly Ethereum and its scaling solutions, have become the backbone for institutional tokenization efforts. Ethereum’s 'Fusaka' upgrade, boosting BLOB capacity eightfold, and the growing adoption of Layer 2 networks like Arbitrum and Base, provide the scalability and security institutions demand. BlackRock’s endorsement of Ethereum as the foundational blockchain for Wall Street tokenization highlights its transition from a speculative asset to the institutional crypto rails underpinning traditional finance. JP Morgan’s pragmatic deployment of tokenized commercial paper on Solana and the launch of tokenized money market funds on Ethereum exemplify how institutions are experimenting with and integrating blockchain technology to enhance capital efficiency and settlement speed.

Strategic partnerships and ecosystem collaborations are driving mainstream adoption and interoperability across traditional finance and blockchain. DTCC’s alliance with Chainlink to launch a 24/7 collateral AppChain by Q4 2026, backed by JPMorgan, BNY Mellon, and Franklin Templeton, aims to revolutionize collateral workflows with automated pricing and near real-time settlement. Similarly, LayerZero’s launch of the Zero blockchain, supported by Citadel Securities, NYSE, Google Cloud, and ARK Invest, represents a concerted institutional push toward scalable, interoperable blockchain infrastructure. Meanwhile, crypto-native platforms like Ondo Finance have gained institutional validation by joining DTCC’s working group, while Kraken’s milestone of $20 billion in tokenized equity volume and its Federal Reserve master account highlight the growing integration of digital asset banks into traditional financial systems.

The New York Stock Exchange and Intercontinental Exchange (ICE) are aggressively advancing tokenized equity initiatives, investing heavily in crypto exchanges like OKX to enable on-chain trading of NYSE-listed stocks by late 2026. NYSE’s approach emphasizes native issuance and settlement on permissioned blockchains to unlock the full benefits of on-chain capital markets, potentially eliminating intermediaries and enabling 24/7 trading. This contrasts with DTCC’s strategy of preserving existing clearing structures while integrating blockchain technology. Regulatory collaboration remains central, with NYSE working closely with the SEC and FINRA to ensure compliance and investor protections, signaling a cautious but determined institutional embrace of blockchain’s transformative potential.

Strategic alliances—like DTCC with Chainlink and LayerZero’s Zero blockchain—are bringing together giants from traditional finance and crypto to create interoperable, real-time settlement platforms at global scale.