Asset Tokenization in Financial Markets 2025

Contents46 5.3 New market roles New intermediaries will also support the asset life cycle, potentially with more participants than conventional setups.128 This research found that there may be two new classes of entities to support the capabilities needed to deliver tokenization at scale: new market structures and digital-native service providers. Combined, these two groups plus incumbents would then drive product development forward using tokenization’s features. New market structures New market structures are expected to play critical roles across the asset life-cycle steps. Token Issuers could provide asset issuance services on-chain, including developing and deploying token contracts. Once the tokenized asset is available, a digital asset exchange could offer compatible trading services, driving liquidity and market depth. Digital securities depositories (DSDs) could be introduced as a native service provider on DLT networks to perform one or more of the actions typically provided by CSDs, including settlement and management of securities.129At least three new digital-native market structures are conceivable: — Token asset issuers and developers will create and structure tokenized assets, ensuring regulatory compliance and embedding programmability to unlock new market efficiencies. These entities will also develop, upgrade and maintain the underlying tokenization platform or DLT and build digital workflows for pre-issuance activities, automating various workflows between parties until deal-closing.130 — Digital asset custodians will specialize in secure cryptographic key storage and management, enabling institutional-grade custody and access control for tokenized assets. In many cases, incumbents will use digital asset custodians should they decide not to build their own capabilities. — Digital asset exchanges will facilitate the trading and liquidity of tokenized assets, bridging traditional finance with programmable ledger-based assets. Digital-native service providers Digital-native service providers will provide solutions for the secure issuance, trading and custody of digital assets. The adoption of these services by financial institutions will require licensing and will vary by region. Often, incumbents or new market structures will employ these services in their delivery of tokenized products. At least five new digital-native service providers are conceivable: — On-chain identity providers could streamline identity verification, but trust in third-party issuers remains uncertain, so institutions may prefer proprietary KYC processes and certificate authorities are more likely than custodians to become trusted issuers while liability in transferring verified identities remains unresolved. — Interoperability providers could provide interoperability services between programmable ledgers and conventional systems (e.g. ACH, Swift) for settlement. — Node operators could provide resources to verify transactions, produce blocks, facilitate consensus and update the ledger or chain. — Key management providers could offer specialized custodial services to safekeep tokenized assets and help financial firms meet compliance measures, including BitGo and Metaco (acquired by Ripple). — Smart contract auditors could provide auditing and monitoring of smart contracts to ensure the verifiability and safety of the deployed contract. 5.4 New products Evolving market structures and the rise of digital-native service providers could enable the creation of innovative financial products by facilitating creativity, largely fuelled by composability and programmability. These advances can unlock new liquidity models, risk-free uncollateralized lending and more efficient capital markets, reshaping traditional finance with programmable, automated and highly composable financial primitives. For example, as the Bank of Canada explored, flash loans native to blockchain ecosystems illustrate how uncollateralized lending with zero default risk transforms liquidity access for sophisticated market participants.131 Additionally, new mechanisms, such as using crypto-assets for collateral and smart funding – where assets are aggregated and liquidated based on payment needs, such as converting ETH to fiat-backed stablecoins in real time to facilitate payments – can further accelerate product development.132 Impacts of tokenization