Ravi Chamria is the cofounder and CEO of Zeeve Inc.
The financial services industry has been making strides toward tokenization over the last few years. Financial institutions are investing in researching use cases and launching pilots to test the viability of tokenizing real-world assets.
Early projects simultaneously sparked excitement about tokenization’s potential and exposed weaknesses in a piecemeal approach. A 2024 Deloitte article discussed projections that “tokenization in financial services could generate trillions of dollars in new value this decade” and proofs of concept from several financial institutions. It also outlined key challenges to widespread tokenization, including regulatory compliance risks, transparency and privacy conflicts and a lack of interoperability standards.
The early token implementations I’ve seen don’t include payment and settlement functionality. They either use stablecoins across the board or deploy a system that combines tokenized assets and traditional payment rails. But tokenizing assets without modernizing the payment infrastructure creates a broken process. Part of the process uses blockchain fintech while the rest is still rooted in legacy banking.
An IBM report stated that “2026 will be a turning point for tokenization.” Yet traditional banks are still falling behind: “Most incumbent institutions are saddled with core banking systems and processes built for a pre-tokenized economy. Despite billions invested, most banks remain mired in protracted modernization programs.”
It’s now time to modernize the industry’s entire financial infrastructure, from assets and payments to treasury operations and cross-border remittances. I predict that the financial services industry is on the cusp of a massive change; in the next couple of years, we will see the tokenization of assets quickly picking up steam, followed by the tokenization of payments and settlements.
My Web3 infrastructure company works with a customer that has investments from five large banks. Through my work, I see clear signs that institutions are moving from implementing individual use cases to completely upgrading their tech stacks. Major banks are launching tokenized deposits as a programmable alternative to stablecoins, capable of handling payments and settlements while operating within current privacy and regulatory frameworks.
But leaders at many midsize banks that I have conversations with are still oblivious to this trend. This puts leaders at a disadvantage. There is a window of opportunity with tokenization, but it won’t stay open forever. I want enterprise leaders to understand the opportunities and obstacles of a tokenized financial infrastructure while there is still a first-mover advantage.
Understanding Public Chains Versus Blockchains
A common misconception I hear about tokenization is that it is a privacy risk. Bank leaders often fear that assets are tokenized on a public blockchain—which would expose their customer data and violate compliance regulations. But this isn’t the case at all.
My team and I teach leaders that most use cases at the bank level require them to develop their own custom chain. I encourage leaders to build privacy and compliance into their infrastructure from the beginning, so they can stay competitive with new technologies without compromising any regulatory rules.
Seeing The Business Case For Tokenization
Major banks are already moving trillions of dollars in tokenized deposits within the traditional banking system. The world’s largest asset manager has tokenized billions of dollars of treasury funds to trade on-chain.
We’re already seeing the benefits of tokenization being realized in the financial services industry, and I believe we will soon see the same transformation in enterprises across other sectors. A fully tokenized, on-chain financial infrastructure would enable true 24-hour markets with real-time transactions, unlock greater liquidity and facilitate cross-border payments without intermediaries.
Finding The Right Starting Point
For banking leaders unsure where to begin, I recommend focusing on tokenized deposits first. By tokenizing existing deposits for corporate customers, where the transaction size is higher, they can focus on managing the corporate treasury as well as customer retention and new customer acquisition. Once a deposit layer is in place, banks can expand into payments.
I frequently meet with tech teams and business teams that have distinct perspectives on building a tokenization infrastructure. These are the critical questions I think they should be asking:
Tech Teams
• How will this process work with our core banking systems?
• How can we manage privacy at an infrastructure level?
• How can we manage operations from a risk perspective?
Business Teams
• How will this implementation affect our bottom line?
• How will this help us acquire and retain more corporate customers?
• How can we use this infrastructure to develop new products and services?
I think it’s a mistake to wait for the perfect time to build a tokenized infrastructure. There is no perfect time. There will always be challenges to overcome. But it is the right moment to get started. It’s not an exaggeration to say that in a few years, the entire financial services infrastructure will be modernized using blockchain. Banks that take the lead now have an opportunity to keep that lead in the long run.
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