Citigroup sees tokenization powering an $8 trillion market by 2030, with real‑world assets increasingly moving onto blockchains as part of mainstream financial infrastructure.
In a recent outlook, the bank estimates that tokenized assets could reach around $5.5 trillion in value under its base scenario by the end of the decade. Under a more optimistic trajectory, where regulations mature and institutional adoption accelerates, that figure could climb as high as $8.2 trillion.
Tokenization moves from pilot projects to core infrastructure
According to Citigroup’s analysis, tokenization is no longer confined to small‑scale experiments or innovation labs. As regulatory frameworks slowly take shape and large financial institutions get more comfortable with blockchain rails, tokenized instruments are being woven into existing capital markets workflows.
The bank argues that the shift is structural rather than cyclical: settlement, custody, and distribution are gradually adapting to support digital representations of traditional instruments such as funds, bonds, equities, and commodities. Instead of building parallel systems, many incumbents are integrating blockchain technology into their legacy infrastructure, paving the way for larger volumes of tokenized assets.
Market already above $40 billion and accelerating
On‑chain data indicates that this transition is not just theoretical. Analytics firm Token Terminal estimates that tokenized assets now exceed $43 billion in aggregate market value, reflecting growth of roughly 37% over the last six months. That pace suggests increasing comfort among issuers and investors with blockchain‑based products.
Not all data providers agree on the exact size of the market. Another tracker places the value closer to $33 billion. The discrepancy stems mainly from differing definitions of what qualifies as a tokenized asset and how products are categorized-for example, whether some structured DeFi products or yield‑bearing vaults are treated as tokenized securities or as purely crypto‑native instruments. Still, both data sets point toward the same underlying conclusion: the tokenization sector is expanding quickly from a relatively small base.
Tokenized funds dominate, but diversification is underway
Token Terminal’s breakdown shows that tokenized funds currently represent nearly 80% of the total market capitalization of tokenized assets. These products often wrap traditional instruments-such as money market funds, bond portfolios, or mixed‑asset strategies-into blockchain‑based tokens that can be traded, transferred, and used as collateral.
Commodities make up about 16.6% of the tokenized asset universe, including tokenized gold, other precious metals, and in some cases energy or agricultural exposures. Tokenized stocks, while still a niche, contribute around 3.8% of the market, reflecting early experiments with equity instruments that can settle on‑chain while referencing off‑chain corporate ownership records.
This composition highlights a key theme: tokenization initially gained traction with the most familiar and low‑risk instruments, such as short‑term debt and cash‑equivalent products. As infrastructure, legal frameworks, and investor understanding improve, more complex and yield‑bearing products are starting to appear.
Ethereum leads, but tokenization is becoming multi‑chain
From a network perspective, activity is still highly concentrated. Ethereum hosts about 57.8% of the tokenized asset value tracked by Token Terminal, underlining its role as the primary settlement layer for institutional DeFi and tokenized finance.
BNB Chain holds roughly 8.5% of the market, while zkSync Era, a zero‑knowledge rollup, accounts for about 7.5%. XRP Ledger and Stellar each have a meaningful presence, with 5.8% and 5.4% respectively. These alternative networks often compete on lower transaction costs, higher throughput, or features tailored for payments and asset issuance.
The multi‑chain distribution suggests that tokenization is not locked into a single blockchain. Institutions are likely to use different networks for different functions-such as using Ethereum for high‑value settlement and rollups or alternative chains for faster retail‑facing applications. Over time, interoperability solutions may allow tokenized assets to move fluidly across chains, further supporting liquidity and risk management.
Leading issuers and platforms
On the issuer side, Sky currently ranks as the largest player, overseeing around $6.1 billion in tokenized assets. Securitize and Ondo Finance each manage roughly $3.6 billion, highlighting the role of specialized platforms that bridge the gap between traditional compliance requirements and blockchain‑based distribution.
These issuers typically handle functions such as investor onboarding, know‑your‑customer checks, regulatory filings, and corporate actions, while also delivering the technological infrastructure required to mint, burn, and transfer tokens. As more regulated institutions enter the space, the division of labor between traditional custodians, transfer agents, and tokenization platforms is becoming clearer.
Financial advisors shift focus to practical blockchain use cases
Interest from professional investors is rising alongside this growth. In a recent note, Bitwise Chief Investment Officer Matt Hougan reported that discussions with representatives of over 40 financial advisory teams revealed a noticeable pivot in focus: many advisors are now more interested in practical blockchain applications-such as tokenized real‑world assets, stablecoins, and payment solutions-than in directional bets on flagship cryptocurrencies like Bitcoin.
Survey data further illustrates this gradual normalization. A study conducted in partnership with VettaFi found that 56% of financial advisors personally hold crypto assets, while 42% are already able to allocate digital assets on behalf of clients through their platforms. Collectively, these advisors supervise more than $175 trillion in assets, suggesting a vast pool of capital that could eventually flow into tokenized products once regulatory constraints and operational hurdles are resolved.
Major banks expect DeFi to ride the tokenization wave
Several large banks have started to articulate how tokenization could reshape decentralized finance. Standard Chartered recently initiated research coverage on Uniswap and argued that tokenized assets may become a key engine for DeFi adoption. Its analysts projected that the DeFi sector could grow to around $2.7 trillion in value by 2030 if more traditional financial instruments migrate to blockchain‑based markets.
In that view, DeFi protocols are not just trading venues for crypto tokens but potential infrastructure layers for on‑chain versions of bonds, funds, and other securities. Automated market makers, lending pools, and yield strategies could increasingly revolve around tokenized real‑world assets rather than purely speculative tokens, making the ecosystem more relevant to mainstream capital markets.
Strategic role of market infrastructures like DTCC, NYSE, and Nasdaq
Citigroup’s report highlights the importance of major market infrastructures in determining the pace and shape of tokenization. Organizations such as the Depository Trust & Clearing Corporation, the New York Stock Exchange, and Nasdaq are seen as pivotal because they manage core processes for issuance, custody, clearing, and settlement.
If these institutions adopt blockchain standards for some of their operations, tokenization could scale far beyond isolated pilot projects. On‑chain records could eventually coexist with, or even replace, parts of legacy databases, potentially streamlining corporate actions, reducing settlement risk, and lowering operational costs. However, such changes will require coordinated regulatory approval, robust security guarantees, and industry‑wide agreement on technical standards.
Beyond funds and credit: equities and other assets join the mix
While tokenized funds and private credit products currently dominate, interest in tokenized equities is building. Platforms like Ondo Markets and xStocks are expanding access to stock‑linked tokens, allowing investors to gain equity exposure through blockchain‑based instruments that settle faster and can be integrated into DeFi strategies.
Tokenized equities often face more complex regulatory questions than tokenized bonds or money market products, especially around shareholder rights, voting, and disclosure. Even so, the appeal of nearly 24/7 trading, programmable dividends, and the ability to fractionalize high‑priced shares is attracting both retail and institutional attention.
Tokenization moving beyond U.S. Treasuries
Research from Binance’s institutional arm suggests that tokenization is no longer primarily focused on U.S. Treasury‑linked products. Initially, short‑term government debt and related cash‑equivalent instruments led the trend because of their relatively straightforward structure and strong demand from stablecoin users and yield‑seeking investors.
Now, however, the sector is evolving into a more diversified ecosystem that spans multiple asset classes. This includes corporate credit, real estate‑backed products, private market exposures, and alternative assets. Many of these instruments can be engineered to generate cash flows-such as interest, rent, or profit‑sharing-that are distributed on‑chain, offering new income‑generating opportunities for token holders.
Why tokenization matters: key benefits driving adoption
Several core advantages explain why institutions and regulators are taking tokenization seriously:
1. Operational efficiency
Tokenized assets can settle faster and with fewer intermediaries, reducing both counterparty risk and back‑office costs. Smart contracts can automate coupon payments, redemptions, and corporate actions, cutting down on manual reconciliations and errors.
2. 24/7 markets and global reach
Blockchain networks operate around the clock, which means tokenized instruments can, in principle, trade without the traditional constraints of market opening hours. This appeals to global investors spanning multiple time zones and enables immediate reaction to macro events.
3. Fractional ownership and liquidity
High‑value assets-such as commercial real estate or infrastructure projects-can be broken into smaller token units, allowing a broader range of investors to participate. Fractionalization can enhance liquidity in markets that have historically been illiquid and slow to trade.
4. Programmability and composability
Tokens can be embedded into DeFi protocols, used as collateral, or combined in structured products. This composability allows developers and financial engineers to build more sophisticated and automated strategies on top of tokenized real‑world assets.
5. Transparency and auditability
Public blockchains offer real‑time visibility into token supply, transaction history, and in some cases collateral backing. This can improve risk monitoring for regulators, auditors, and investors, provided privacy and data protection are adequately managed.
Key challenges that could slow the $8 trillion trajectory
Despite bullish forecasts, several obstacles could prevent the market from reaching the high end of Citigroup’s estimates:
– Regulatory uncertainty: In many jurisdictions, rules governing tokenized securities, investor protections, and cross‑border distribution remain under development. Slow or fragmented regulation can deter large institutions from moving aggressively.
– Legacy system integration: Existing financial infrastructure is deeply entrenched. Integrating blockchain rails with core banking, custody, and clearing systems is technically complex and can be costly.
– Legal enforceability: Ensuring that token holders have clear, enforceable rights under local law is essential. Discrepancies between on‑chain records and off‑chain legal ownership can create risk if not carefully structured.
– Security and operational risk: Smart contract vulnerabilities, key management failures, and infrastructure outages pose reputational and financial risks. Institutions demand rigorous standards, audits, and insurance solutions.
– Liquidity fragmentation: As tokenized assets spread across multiple blockchains and platforms, liquidity can become fragmented. Interoperability and standardized market practices will be needed to consolidate depth and improve price discovery.
What the forecast means for investors and institutions
If Citigroup’s base‑case scenario plays out and tokenized assets reach roughly $5.5 trillion by 2030, tokenization will have moved from a niche innovation to a core pillar of global capital markets. In the more optimistic $8.2 trillion case, the distinction between “crypto” and “traditional finance” may blur significantly, with many mainstream financial products existing as tokens by default.
For institutional investors, this implies several strategic priorities: building the technical and operational capacity to custody tokenized assets; establishing risk management frameworks for on‑chain exposures; engaging with regulators to shape workable rules; and exploring how tokenization can improve liquidity and access in private markets.
For individual investors and smaller firms, the shift could open access to previously restricted asset classes, offer more flexible trading hours, and enable new ways to generate yield. At the same time, it will demand greater attention to counterparty risk, smart contract security, and jurisdiction‑specific regulations.
Outlook: from experimentation to ubiquity
The rapid growth from tens of billions today to potentially trillions by 2030 hinges on a simple dynamic: tokenization only needs to capture a small percentage of the global asset base to reach enormous absolute numbers. Global bond, equity, and real estate markets together exceed hundreds of trillions of dollars. Even single‑digit percentage penetration would be enough to validate Citigroup’s projections.
The coming years are likely to be defined by larger live implementations, closer collaboration between regulators and industry, and increasing integration of tokenized products into everyday financial tools. If those trends continue, tokenization may come to be seen not as a speculative offshoot of crypto, but as a natural evolution of how ownership and value are recorded, transferred, and managed in the digital age.