The following is a guest post and opinion from Laura Estefania, Founder and CEO of Conquista PR.
The past decade of digital assets has been shaped as much by debacle as by innovation. High-profile collapses, sensational headlines, and regulatory whiplash distorted public perception, leaving technologies capable of modernizing global finance viewed through a lens of suspicion.
Beneath that noise, however, tokenization has quietly crossed an irreversible threshold.
As recent analysis by Larry Fink and Rob Goldstein makes clear, tokenization is no longer an experiment. It is becoming part of the underlying infrastructure of financial markets. The constraint today is not technological maturity, it is perception.
Tokenization is edging closer to becoming a mainstream capital raising tool. The efficiency gains and benefits of broader access are simply too big to ignoreIssuers in growing economies have an unrivaled opportunity to boost market inclusion through blockchain-native capital raises.”
The Perception Problem Is Not Cosmetic
Perception in finance shapes real outcomes. It influences capital formation, informs regulatory posture, and determines whether institutions feel confident enough to integrate new systems.
The problem is not that tokenization lacks technical readiness. The problem is that it is still being judged through the legacy optics of past crypto excesses.
In finance, perception becomes a gating mechanism. It defines what decision-makers feel allowed to deploy.
What Tokenization Changes, and What It Does Not
Tokenization does not expand the regulatory perimeter or rewrite who may invest in which instruments. Securities laws, investor classifications, and jurisdictional restrictions remain firmly in place.
What changes is the infrastructure through which compliant participation is executed, monitored, and scaled.
Tokenization tends to improve:
- Settlement speed, reducing counterparty and liquidity risk
- Operational efficiency, reducing reconciliation and administrative overhead
- Transparency, improving auditability of ownership and flows
- Programmability, enabling automated compliance and distributions
Tokenization does not automatically change:
- Who is eligible to invest
- Whether an instrument is regulated
- Disclosure obligations
- Jurisdictional restrictions and enforcement
Why “Fractional Ownership” Isn’t the Revolution People Think It Is
Fractional ownership is not a legal breakthrough. Corporate equity has always been divisible, and debt has long been issued in varied denominations. The limiting factor has been operational, not conceptual.
Traditional market plumbing makes granular participation inefficient due to:
- Settlement delays
- Reconciliation layers
- Custodial overhead
- Administrative complexity
By recording ownership as a verifiable digital entry that can move at the speed of information, tokenization removes friction. What was legally permissible but economically impractical becomes viable at scale.
Major asset managers are already building regulated tokenized products and settlement rails, including initiatives tied to BlackRock and Franklin Templeton.
The Misalignment: Capability vs. Narrative
None of this is speculative or ideological. It is infrastructure improvement.
Yet tokenization is still evaluated through the afterimage of prior market failures, where retail speculation and platform collapses dominated the public story. That misalignment risks slowing adoption precisely where tokenization offers measurable benefits: lower costs, faster settlement, and greater transparency.
The consequence is simple: institutions hesitate, even when the technology is ready and the use case is already regulated.
Emerging Markets Are Treating Tokenization as a Utility
Outside the West, tokenization is often less a theory and more a practical response to structural friction. In many emerging markets, the challenge is not replacing a highly efficient banking system, it is compensating for one that can be fragmented, slow, and expensive to access.
Common pain points include:
- High financing costs driven by currency risk and intermediary fees
- Slow or costly cross-border settlement
- Limited access to stable settlement assets
- Administrative barriers to efficient capital flows
Tokenization does not remove regulatory constraints, but it can reduce operational frictions that inflate the effective cost of capital. Faster settlement, transparent ownership records, and programmable compliance reduce reliance on intermediaries, allowing global liquidity to reach local projects with fewer layers of cost and delay.
This dynamic is discussed in broader regional adoption research, including the Milken Institute’s coverage of Sub-Saharan Africa’s digital asset landscape here.
The West’s Perception Gap Is Becoming a Competitive Risk
In the U.S. and Europe, regulatory attention remains heavily oriented toward classification and containment, even as stablecoins and tokenized government securities already move significant value across borders. Institutions run pilots, then pause. Not because the tech fails, but because reputational risk and public perception still blur “market infrastructure” with “speculative activity.”
Citi, for example, projects that tokenization of financial and real-world assets in private markets alone could reach the trillions by 2030. Yet many institutions still treat tokenization as optional experimentation rather than inevitable modernization.
This is not merely a communication problem. It is a competitive one. Jurisdictions that assess tokenization through efficiency, risk management, and capital flow optimization are pulling ahead, while others preserve complexity the rest of the world is actively designing around.
For a discussion of how major institutions approach on-chain experimentation, see CryptoSlate’s coverage here.
Europe and the Gulf: Different Paths, Similar Destination
Tokenization does not need evangelism. It needs comprehension, and regulators willing to judge financial infrastructure by outcomes rather than optics.
Europe: Formalization and Institutional Clarity
Under the EU’s Markets in Crypto-Assets Regulation (MiCA), Europe has prioritized standardization. MiCA does not regulate tokenized securities, those remain governed by existing capital-markets law. Instead, it sets rules for crypto-assets that fall outside traditional financial regulation, including governance, disclosure, and reserve management for certain on-chain settlement instruments.
That clarity improves institutional readability, which is a prerequisite for banks, asset managers, and custodians to engage at scale (MiCA text and implementing materials can be accessed via EUR-Lex).
The Gulf: Controlled Execution and Production Pilots
Rather than a single pan-regional framework, Gulf jurisdictions have emphasized structured rollout: sandboxes, phased licensing, and regulator-led pilots that move tokenized deposits, funds, and payment instruments from proof-of-concept to production.
You can see examples of this regulatory posture through bodies such as ADGM and the UAE Securities and Commodities Authority.
Different strategies, same logic:
- Instant settlement reduces counterparty and liquidity risk
- Fractionalization lowers the minimum economic threshold for participation
- Compliance can be encoded, monitored, and audited more directly
- Legacy workflow fragmentation is reduced
Emmanuel Givanakis, CEO of the Financial Services Regulatory Authority (FSRA) at Abu Dhabi Global Market (ADGM) in October 2025 said:
The FSRA continues to enhance its digital asset regulatory framework to remain forward-looking and responsive to the next wave of financial innovation, including tokenization, DeFi and AI-driven market participation. Our approach balances innovation with strong governance, risk-based supervision, and alignment with global standards. We are committed to enabling digital asset firms to scale within a well-regulated international financial centre that prioritises transparency, resilience, and long-term stability.
Tokenization Replaces Fragmented Workflows With a Single Ledger
Tokenization becomes operationally powerful because it replaces fragmented legacy workflows with a single programmable ledger.
In practice, this can mean:
- Distributions executed in unified transactions
- Ownership records updating automatically
- Transferability no longer depending on layered intermediaries
- Compliance checks embedded into the transaction flow
What was always legally possible but operationally inefficient becomes feasible at scale.
From Debate to Deployment
Finance is being rewired in parallel across regions that rarely move in sync. The technology is mature, demand is visible, and regulatory pathways are no longer hypothetical.
What has changed most decisively is not the code, but the context in which it is now understood. Tokenization is moving out of yesterday’s headlines and into the domain of policy, prudential supervision, and institutional balance sheets.
Once tokenization is understood as infrastructure, the burden of proof reverses. The question becomes not whether it belongs in the financial system, but how efficiently it can be deployed, supervised, and scaled.
Key Takeaways
If you only read one section, read this:
- Tokenization is not a loophole around regulation, it is a modernization of compliant market plumbing.
- The main constraint is no longer technical maturity, it is perception and institutional risk tolerance.
- Emerging markets often adopt on-chain rails as utility, because legacy friction is tangible and daily.
- Europe is leaning into formalization and clarity, the Gulf is leaning into controlled execution.
- The winners will be jurisdictions that treat tokenization as infrastructure, then build supervision and standards around it.
Tokenization’s formative debate is ending. What follows is an execution phase, defined less by ideology and more by governance, interoperability, and speed. The markets that recognize this earliest will not merely adopt tokenization, they will help define how global finance operates in its next iteration.