Author: Aleks Larsen, Partner at Blockchain Capital

Translation: Jiahua, ChainCatcher

The financial industry has always faced a costly "packaging" problem.

Each asset has different ways of recording and managing, and exists in fragmented systems: a mortgage consists of contracts, PDF files, databases, and post-loan management relationships; an equity in a private equity fund may simply be a line in a subscription agreement and a transfer agent form; the ownership of a stock is dispersed across multiple records held by brokers, custodians, and securities depositories.

When an asset moves from one institution to another, it often needs to dismantle the original records, go through validation and verification, and then be re-registered according to the receiving party's rules. Many operational processes exist simply because different institutions record the same underlying asset or rights in different ways.

This fragmentation has caused significant hidden costs globally. The balance sheets of various assets worldwide record nearly $18 trillion in assets, a large portion of which still cannot flow freely between institutions without specially designed operational processes. These frictions slow down the speed at which capital can be redirected to new enterprises, infrastructure, housing, and other productive uses.

Tokenization fundamentally solves this problem. Tokens provide a standardized, machine-readable interface for assets or financial rights. When assets can be identified and utilized within a shared network, trading platforms, lending institutions, custodians, asset servicers, and software applications can interact directly with them, without the need to repeatedly build an entire financial infrastructure from scratch.

This enables capital markets to establish a common, programmable underlying network, allowing for smoother circulation, settlement, and utilization of assets.

Understanding how tokenization will change the world is best illustrated by the analogy of containerization.

Containerization Spurred the Modern Global Supply Chain

Before the 1960s, goods were transported in various forms. Coffee was packed in burlap sacks, machinery was placed in wooden crates, cotton was baled, and oil was stored in barrels. Each type of product had different loading and unloading requirements, so each ship had to rely on manual labor to handle the loading and unloading processes.

Skilled dockworkers developed a whole set of techniques around this work. They needed to stack goods as tightly as possible, balance the weight, and secure the cargo to prevent movement and damage at sea. This craftsmanship was indispensable primarily due to the lack of uniform shipping packaging standards at the time.

As a result, cargo ships often spent more time in port than in transit. Bulk goods needed to be loaded and unloaded multiple times during transfer between ships, trains, trucks, and warehouses, making them more vulnerable to damage, loss, or theft.

In 1956, North Carolina shipping entrepreneur Malcolm McLean converted an oil tanker into the Ideal-X, carrying 58 detachable truck containers from Newark to Houston.

Once at port, trucks could directly pick up the containers without opening them. The unloading cost of the Ideal-X was only $0.16 per ton, about 36 times cheaper than traditional bulk cargo shipping methods. This marked the birth of modern shipping containers.

Over the next 20 years, the sizes, connections, and load requirements of containers gradually formed standardized norms. The entire supply chain began to reorganize around this standardized box, allowing for further specialization at each stage.

Cargo ships started using vertical holds, allowing containers to be safely stacked; cranes were designed to meet the high-speed, standardized loading requirements; truck chassis and rail freight cars adopted uniform sizes and securing devices; and ports gradually transformed into large hubs for efficient container transfer between different modes of transportation.

The most direct impact of containerization was the significant reduction in transportation time and costs. The transportation time from Australia to Europe was reduced from 70 days to 34 days, with ship capacity increasing fourfold.

International trade began to pivot more towards finished and intermediate goods, with companies starting to break their production processes down into different countries. As the supply chain expanded rapidly, a new wave of logistics companies emerged to coordinate the increasingly complex global networks.

On a deeper level, the scale of economic activity grew dramatically. The World Bank estimates that in the 15 years following the adoption of containers by both trading parties, bilateral trade among developed countries grew by 1240%.

Containerization and the infrastructure reconstruction it promoted allowed for massive expansion of global supply chains and significantly accelerated global economic development.

Tokens are the Containers of the Financial World

Tokens are standardized containers that carry financial rights.

What they carry is not goods, but the ownership of assets, rules of transfer, cash flows, permission requirements, and other status information. In other words, tokens record who owns the asset, how it circulates, what cash flows are generated, and what operations software can perform on it.

Once an asset has a machine-readable interface, trading platforms can offer it for trading, the lending market can accept it as collateral, custodians can hold it, and wallets can receive and manage the cash flows it generates. Software applications can directly identify the asset and execute corresponding rules without having to negotiate and connect separately with every relevant institution.

This is precisely the fundamental difference between tokenization and merely "digitizing documents" or "adding a database": all participants can identify and utilize the asset according to the same set of standards. Once this standard is adopted by the entire ecosystem, the network effects will continuously accumulate.

Stablecoins clearly demonstrate the potential of tokenization.

Traditional international wire transfers often require going through an agency banking system, taking several days to complete the transfer of dollars; stablecoins can arrive around the world in seconds, with near-zero costs for on-chain transfers.

This is because a global network has formed consisting of trading platforms, custodians, fiat and stablecoin conversion service providers, payment processors, and wallets, all of which can recognize the token interface of stablecoins. They function like ports, cranes, trucks, trains, and cargo ships in the financial world, responsible for transporting value in token form.

A lot of the underlying infrastructure was originally built for Bitcoin and Ethereum, but once these facilities were established, stablecoins and other tokens could circulate along the same network. Activities in stablecoins further attract users, liquidity, applications, and infrastructure, allowing later entrants to utilize this network directly.

The results are already apparent. The current scale of circulating stablecoins is about $300 billion, processing transaction volumes approaching that of Visa, with a fund turnover rate about 10 times that of traditional M1/M2 money.

Cross-border payment costs have dropped by an order of magnitude, allowing hundreds of millions of people globally to gain more reliable access to dollars and payment channels. At least in dollar scenarios, this network has proven its value, clearly outperforming traditional systems in terms of costs, speed, and coverage. The same dollar funds can circulate more frequently within the network, increasing capital utilization efficiency.

Today, this highly active pool of dollar funds is beginning to attract other assets onto the chain to accommodate these stablecoin funds. Currently, the scale of on-chain tokenized assets beyond stablecoins is nearing $40 billion, about 10 times what it was two years ago, and the growth is still accelerating.

These assets encompass U.S. Treasuries, money market funds, commodities, private credit, stocks, and fund equities, with hundreds of issuers involved.

Figure: RWA.xyz, total scale of on-chain RWA

The next natural development is to bring the business processes behind financial assets onto the chain.

For example, the company we invest in, Tare, is bringing loan issuance, ongoing management, and securitization onto the chain, using tokens to record the complete lifecycle information of each underlying loan.

Through lightweight software and transparent public markets, Tare can replace the costly, multi-step lending chains in the traditional system. In this market, both lending sides can record and verify tokenized loans in the same ledger.

This model not only reduces lending costs but also makes it easier for loans to be accepted as collateral for different on-chain applications, thereby attracting more assets and funds into the tokenized network.

Every asset class presents similar opportunities. As infrastructure continues to improve, network effects will keep attracting more liquidity, users, and applications, further accelerating the growth of tokenized assets.

Capital Markets Will Restructure Around Tokens

Just as global supply chains reorganized around containers, global capital markets will also restructure around tokens.

This new form is already visible in DeFi. Another company we invested in, Aave, allows users to use eligible tokens as collateral to secure funding from the lending market at floating interest rates. The related rules are written into the protocol, determining whether an asset can serve as collateral based on asset-level standards.

This structure is vastly different from traditional lending markets.

In today’s financial system, an individual or business wanting a loan against an asset typically needs to find an institution first. The institution controls access, assesses borrowers through its own processes, and offers products through its network. What financial services customers can access largely depends on their relationship with financial institutions.

On Aave, the true access condition is the asset itself. Smart contracts recognize tokens, execute open and transparent rules, and connect them to the capital markets.

The logic of access to financial services has thus changed:

Financial services are beginning to focus on the asset itself, rather than depending on the relationships the asset holder has with any institution.

In other words, tokens give assets executable qualities similar to software.

When an asset exists in a form recognizable by public networks, different applications can provide services such as trading, financing, payment, and capital management around the same asset. Trading platforms can allow it to enter the market, lending protocols can accept it as collateral, and wallets can receive and manage the cash flows it generates.

Issuers only need to put the asset on-chain once to connect to various applications without having to establish a separate system for each use case.

This will also change the organizational structure of financial institutions. Banks, securities firms, and asset management companies typically provide a packaged suite of functions like custody, underwriting, liquidity, asset management, compliance, and distribution within closed product systems.

Cryptographic networks allow these functions to be split and professionalized. One institution can handle issuing and managing loans, while others can provide funding, assess risk, complete transactions, offer insurance, or develop applications utilizing that asset.

Assets can flow between different specialized services through a unified interface without needing to be re-registered and reconnect for each service provider.

Thus, economies of scale will shift from single institutions to the entire network.

In traditional financial systems, large institutions can support more products because they can afford the fixed costs of building infrastructure for various assets and customer groups. In public crypto networks, much of the infrastructure is shared among all participants.

New service providers can connect to existing asset, fund, and user networks without having to rebuild ledgers, trading, custodial, and settlement systems. This not only lowers system construction costs but also reduces the barriers for new service providers to enter the market.

The network effects of stablecoins have already crossed a critical point, beginning to form a self-reinforcing system. Capital markets will increasingly reorganize into open service networks built around tokenized assets.

In this new paradigm, institutions will compete on who can provide better capital, underwriting, risk management, asset services, and distribution, rather than who owns the database or who controls the only market entrance for customer access.

The Global Balance Sheets Will Go On-Chain

The most important outcome of this transformation is the establishment of a capital market that covers the globe.

Today’s capital markets are still constrained by financial institutions. Most individuals and businesses cannot access capital markets directly but must choose from the limited products offered by institutions willing and able to serve them.

Which customers to serve, which regions to cover, which asset classes to support, and the scale of transactions accepted are all determined by the institutions.

Investors face similar restrictions, but in the opposite direction. They cannot access all global assets but can only invest in those that have already been underwritten, packaged, accessed, and distributed by institutions.

As a result, significant amounts of economic value still lie beyond the reach of current capital markets.

Small receivables, local infrastructure, private businesses, emerging market credit, and non-traditional cash flows may have real economic value, but their size may be too small, too dispersed, insufficiently recognized in the market, or too far from major capital centers to bear the high costs required by the traditional financial system for financing.

Investment opportunities may exist, and capital may be present, but a network connecting the two does not exist.

Tokenization provides a standardized interface for assets, allowing them to be discovered and utilized on the global finance network. As the financial system reorganizes around this interface, the costs for all participants to enter the market will significantly decrease.

Financial functionalities could be directly embedded into various software like payment and data interfaces. Developers could build specialized services targeting segmented asset classes and specific regions, enabling capital markets to cover previously hard-to-reach areas.

Commercial applications that previously found it difficult to access complex financial services could directly integrate functionalities like payments, working capital financing, collateral management, and capital management into their systems, bringing many dormant or yet-to-enter conventional financial systems assets onto the on-chain capital markets.

Of course, tokenization will not magically allow assets that do not meet financing criteria to become financeable. But in the long term, it can allow many well-quality assets that are currently isolated from capital markets for structural reasons to participate.

AI will further amplify these changes, helping address complex aspects of asset evaluation and operation.

AI agents can assess assets, price risks, allocate capital, manage collateral, and settle transactions in this globalized, efficient, and machine-readable market, further lowering the costs of providing financial services.

With the combined drive of AI and crypto infrastructure, today’s highly customized and discontinuous markets have the opportunity to transform into continuously operating, globally spanning, and increasingly automated markets. This will create more opportunities around the world, allowing capital to gradually break free from institutional barriers.

Capital allocation is one of the core mechanisms determining the flow of social resources. It decides which enterprises can expand, which technologies can be scaled up, which homes and factories get built, and which regions are able to thrive.

For today’s financial system, some assets may be too small, too localized, too specialized in structure, or too high in management costs to justify the dedicated resources needed for evaluation and financing. But when the costs of finding, financing, and managing these assets decrease significantly, they may re-enter the capital markets.

This is also a deeper impact of containerization. Containers not only reduced transportation costs but also made new modes of trade and production economically viable. Goods can be produced in the cheapest locations, assembled elsewhere, and sold globally because the costs of coordinating this network have significantly decreased.

Tokens can have the same effect on capital.

In the coming decades, global balance sheets can evolve from a set of isolated records to a market that software can directly recognize and access. Capital will flow more based on asset quality and return potential, rather than just to institutions that control market channels.

If the development of stablecoins provides a reference, this shift could drive a significant expansion of global capital markets, reaching regions that have never truly been covered before.

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。