jakiro
BlackRock CEO Larry Fink compared asset tokenization (RWA) to “the Internet in 1996.”This sentence can be seen as the beginning of the awakening of traditional finance in the encryption era.
What he means is that encrypted finance is a new financial infrastructure with great potential, but it is still in its early days. Just like the Internet in 1996, most people have not yet realized that it will completely change the existing situation.In 1996, people were still reading magazines/newspapers/listening to the radio/watching TV. Now few people read newspapers and magazines, replaced by online news/social media/live broadcasts/videos.
Look at the Internet in 1996:
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Most people still use dial-up Internet access (56K modem), and the Internet speed is as slow as a snail;
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The Internet speed is slow, the website is ugly, the content is sparse, and ordinary people feel that “the Internet is useless”;
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Amazon was founded just one year ago, eBay was just born, and Google was born two years later;
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Professionals and geeks are already making crazy plans, but Wall Street and traditional companies are still basically laughing at “the Internet is a toy”;
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The infrastructure (broadband/fiber/data centers/browsers) is not quite ready yet.
However, visionaries at that time were already sounding the clarion call for the Internet: “This thing will eventually reshape all industries.”
Look at the current “Asset Tokenization“Situation:
•Ethereum, L2 ecosystem, Solana, etc. have initially built the infrastructure to carry tokenization.
It is now possible to tokenize real assets such as stocks, bonds, funds, private equity, stable coins, gold, real estate, etc., and turn them into encrypted tokens on the chain. However, we are faced with the problems of TPS, cost, privacy, security, compliance, custody, supervision and other aspects of the chain. These have not yet been fully resolved. The difficulties we face now are similar to the situation in 1996.But currently, the evolution of Ethereum and the infrastructure situation are slightly better than in 1996.
•The market size is very small, but the growth rate is starting to pick up
The current total size of RWA in 2025 will only be tens of billions of US dollars, while the total global investable assets exceed 400 trillion US dollars. RWA assets account for less than 1%, and the scale is small; however, in the past two years, with the entry of institutions, the growth rate has picked up.
•There are still many traditional financial institutions that are still waiting to see or laugh at
Some banks/institutions are still saying that “blockchain is just for speculation” and “tokenization is not safe”.
This feels similar to when they said the Internet was just a toy, and how traditional retailers mocked Amazon for being illogical in selling things online.
•A few top players are already all in
However, even if some banks/institutions look down on it, players who see the trend, such as BlackRock, have already entered the game.In 2024, BlackRock launched the U.S. dollar currency fund BUIDL based on Ethereum, which has been growing; Goldman Sachs, Fidelity, Societe Generale, etc. are all exploring tokenized bonds and funds, and even real estate.Is it similar to the early Internet companies starting various attempts from 1996 to 1998?
In addition to traditional players, more crypto players and entrepreneurs will become the protagonists of the future, similar to AAVE/Uniswap/Hyperliquid/lighter/Polymarket, etc. Some may be replaced by latecomers, and there are many new players still on the way. The next 5-10 years will be another golden age for crypto entrepreneurship.
If this trend judgment is correct:
Then,In the next 5-15 years of tokenization, the comprehensive tokenization of various assets will begin with stablecoins that are the easiest to circulate.At present, stablecoins have become a successful case of asset tokenization. Next, there are stocks/bonds/funds/music copyrights/carbon emission rights… Finally, the most difficult thing is gold/real estate, etc…. 24×7 real-time transactions, global circulation, and second-level settlement.
In five years, transaction costs will drop to a completely acceptable level due to the great improvement of public chain infrastructure such as Ethereum. Coupled with the development of privacy technology and compliance supervision, asset transactions and circulation will become more and more feasible.
The era in which retail investors can purchase 1/10,000th of the property rights of an office building in Manhattan may be realized within 10-15 years; and all financial products can be turned into programmable “smart assets”, with automatic balance management/automatic dividends/automatic reinvestment/automatic triggering of mortgages, etc.
In summary, tokenization seems unreliable now, but just like the Internet in 1996, the soil is barren and looks like a toy.But today’s Internet has realized almost all the original ideas.The next 5-15 years will be the best era for crypto financial entrepreneurship.
