STOKR INSIGHTS – ISSUE 005

A Decade of Tokenisation

Tokenisation 1.0 was centred around a set of questions from the vantage of traditional market participants. Could tokenisation increase market liquidity for existing participants? Could it make asset distribution cheaper, and extend it to a wider segment of investors? Could it bring securities and funds to customers that issuers simply could not reach through traditional rails? Could it make servicing cheaper?

Those were valid questions and substantial progress has been made in addressing them. But they were the questions of people asking for a faster horse, not a car. Existing market participants wanted incremental improvements to what they already had. Nobody was asking for an entirely new mode of transportation, because the road it would run on did not yet exist.

Piece by piece, the infrastructure was built over the past several years, issuance platforms, custody frameworks, on-chain settlement rails, and that paved the way for Tokenisation 2.0.

The car arrived anyway. Today, the total market cap of crypto assets sits at approximately $2.5 trillion, of which Bitcoin alone accounts for $1.5 trillion. That is not a faster horse – that is the automobile. Tokenisation 2.0 is defined by that discovery: the shift from incrementally improving access for participants who were already in the market, to reaching investors who never existed at today’s scale and are rapidly growing. Regulatory clarity and a sharper understanding of which assets genuinely belong on-chain are what make that shift commercially possible.

Regulation is Crystallising

Two regulatory milestones in the past twelve months made institutional participation in on-chain finance structurally sensible. In the US, the GENIUS Act, signed into law in July 2025, created the first federal framework for payment stablecoins. Federal agencies are now issuing Notices of Proposed Rulemaking to lock in the act’s guardrails:

The clause with the sharpest market consequence: stablecoin issuers are explicitly prohibited from paying yield to holders. Reserve income stays with the issuer. The OCC’s proposed rules extend that prohibition to affiliates and related third parties, closing the obvious workarounds.

The structural effect: In the US, a stablecoin is legally a non-yielding instrument. A tokenised MMF is not.

In the EU, MiCAR reaches full enforcement in July 2026. For all-encompassing issuers of tokenised securities, two regulatory regimes apply simultaneously. MiCAR governs the crypto-asset payment and custody layer required for efficient on-chain subscription and redemption flows. MiFID II governs the tokenised instrument itself, treating it as a financial security. The result is a clear two-layer framework that, for the first time, operates consistently across EU jurisdictions: MiCAR replaces the patchwork of national VASP regimes with a single harmonised standard for the crypto services layer, while MiFID II continues to govern the tokenised instrument itself, giving European institutional issuers a predictable compliance path regardless of where they operate.

Regulatory clarity does not create demand. But it can remove the reason institutional allocators were waiting.

The Market Has Learned Which Assets Belong On-Chain

Parallel to the regulatory shift, a quieter kind of knowledge has accumulated. The market has learned where the value of on-chain issuance actually sits, and where it does not.

For trading desks or funds running large on-chain positions, a yield-bearing instrument that never leaves the chain and can be deployed as collateral without cash conversion is not a marginal improvement over cash. It is a different operating model. The clearest lesson: a stablecoin earns nothing, while a tokenised money market fund does.

BlackRock’s BUIDL reached $2.5 billion because OKX, Binance, and FalconX already accept it as margin. Circle’s USYC grew from $250 million to $1.3 billion in five months. Ondo’s USDY crossed $2 billion, embedded as collateral in DeFi protocols.

These are operating instruments, not pilots.

The infrastructure case for on-chain fund administration is also real: a single settlement record per transaction, automatic distribution flows, direct investor claims without intermediary layers. UBS Asset Management’s adoption of the Chainlink Digital Transfer Agent standard is a genuine proof point. But it remains a proof point, not a trend.

Significant gaps remain. Information is still clustered and hard to access. Compliance across jurisdictions is uneven. DeFi interoperability is constrained by the same KYC requirements that protect institutional participation. Whitelisted structures are emerging to bridge that gap, but the bridge is still being built.

What Comes Next

For institutional participation, tokenised MMFs are the clearest immediate use case, the easiest asset, the most legible yield, and the most tractable compliance path. But they are only the beginning of the curve, not its summit.

With the infrastructure established, the ball is now in the asset managers’ court to launch higher-yielding instruments, or alternative fund structures for the next leap of on-chain corporate treasury management. Bitcoin treasury companies like Strategy have already shown that a balance sheet can be structured around a digital reserve asset. The logical next step, holding liquidity in a tokenised MMF on the same rails, is coherent. It has not yet become standard practice.

The on-chain capital markets stack is becoming more consolidated, more useful, and more legible to institutional participants. That is the actual story of Tokenisation 2.0: it is a novel digital infrastructure that has matured to the point where the question is no longer whether it works, but what gets built on top of it next.

Tokenisation 1.0 built the functional foundation. Tokenisation 2.0 delivers at scale.