The world of digital assets is rapidly evolving, with stablecoins and tokenized Treasuries reaching unprecedented levels of capitalization. As of September 30, 2025, the capitalization of stablecoin has surged to approximately $280 billion, while tokenized Treasuries have amassed a few billion in Assets Under Management (AUM), according to data from RWA.xyz. This growth signifies a significant push towards scaling real assets on-chain, moving beyond the pilot phase towards full operational implementation.
Over the past 24 months, our team has closely monitored more than twenty institutional tokenization projects, engaging in discussions with banks, asset managers, and infrastructure providers. Reports from the World Economic Forum and McKinsey indicate a rapid increase in institutional interest, with tokenized money market funds surpassing $1 billion in the first quarter of 2024. This shift demonstrates the transition from proof-of-concept to commercially viable products, with adoption accelerating between 2023 and 2025, albeit concentrated in specific liquidity pools.
Key numbers for 2025 highlight the significant impact of tokenization on the financial landscape:
– Stablecoin circulation: ~$280 billion
– Tokenized Treasuries AUM: a few billion
– Treasury yields exceeding 4% during the 2023-2025 period
– US bank deposits totaling over $18 trillion
– Global money market funds market estimated at $8 trillion
– Outstanding US Treasuries amounting to approximately $20 trillion
Tokenization of assets has evolved significantly, enabling the representation of securities, debt, or cash as native tokens on the blockchain. This transformation allows for instant transfers, integration with smart contracts, and programmable collateralization, leading to a shift in asset architecture. The implementation of tokenization has been categorized into three waves: the demonstration of digital scarcity by Bitcoin in 2009, the introduction of smart contracts by Ethereum in 2015, and the institutional use of stablecoin and tokenized real assets since 2020.
The infrastructure supporting tokenization has adapted to accommodate the growing demand for low-risk products and real-time settlement. Ethereum and layer-2 solutions, along with chains like Solana, have reduced latency and costs, enabling almost instantaneous settlement. However, the choice of network still poses a trade-off between performance and composability.
In practice, tokenization involves creating tokens that represent underlying assets, with smart contracts governing mint/burn operations, transfers, and economic rights. The combination of blockchain programmability and traditional safeguards ensures a seamless integration of assets into the digital ecosystem.
The impact of tokenization on markets and liquidity is profound, reducing time and intermediaries involved in transactions. While the liquidity of tokenized assets is still growing, integration with decentralized finance (DeFi) protocols expands their utility, particularly in collateralizing operations and enabling instant settlements.
Real-world case studies, such as Franklin Templeton’s OnChain U.S. Government Money Fund and BlackRock’s USD Institutional Digital Liquidity Fund, highlight the transition from pilot projects to public products endorsed by global brands. Institutions like JPMorgan and MAS are industrializing tokenization processes, facilitating institutional-level tokenized settlement.
Regulatory progress and open issues remain a key focus in 2025, with evolving regulations in Europe and fragmented discussions in the USA regarding stablecoins and asset definitions. Key areas for improvement include regulated platforms for the secondary market, standardized reporting, secure cross-chain interoperability, and clarity on custody, accounting, and taxation.
In conclusion, tokenization represents a fundamental architectural shift in the financial industry, offering increased transparency, reduced friction, and seamless integration of traditional assets into programmable ledgers. With mature infrastructures and institutional players entering the market, the trajectory towards adoption is clear. However, the quality of implementation, regulatory frameworks, and user experience will determine the scale and success of tokenization in the future.