Australia is at risk of falling behind in the global race toward financial innovation due to its slow adoption of tokenization technologies, warned Joe Longo, Chair of the Australian Securities and Investments Commission (ASIC). Speaking at the National Press Club, Longo cautioned that without decisive action, the country could transform into a “land of missed opportunity” as other international markets surge ahead by integrating blockchain-based systems into their financial infrastructure.
Tokenization—converting real-world assets into digital tokens on a blockchain—is increasingly gaining traction around the world. This technology allows for fractional ownership of assets and opens access to previously restricted investment classes. According to Longo, tokenization is not just a passing trend; it represents a structural shift in the global financial ecosystem that could democratize access to capital markets.
He emphasized that tokenization reduces the traditional barriers to entry, enabling retail investors to participate in asset classes that were once the exclusive domain of institutional investors and ultra-high-net-worth individuals. This shift could fundamentally alter how financial markets operate, but only if regulators and institutions are willing to evolve alongside technological advancements.
Despite these transformative possibilities, Longo expressed concern that Australian financial institutions remain overly reliant on outdated systems and are reluctant to embrace innovation. “We are too comfortable with the status quo,” he said, warning that this complacency might lead to talent, capital, and innovation flowing to more progressive jurisdictions.
Countries such as Singapore, the United Kingdom, and the United States are already investing heavily in tokenized financial infrastructure. These regions are testing new models for trading digital securities, issuing tokenized bonds, and supporting blockchain-based settlement systems. By contrast, Australia has been slow to implement regulatory frameworks or pilot programs that could support similar developments.
Longo also pointed to the growing interest of global investors in decentralized finance (DeFi) and blockchain-based assets. As these technologies mature, they could redefine trading, settlement, and ownership mechanisms across global markets. Australia’s failure to act now could result in its issuers and investors seeking more supportive environments abroad.
The ASIC Chair called for a collaborative effort between regulators, policymakers, and private sector leaders to develop a comprehensive national strategy for tokenization. He underlined the need for regulatory clarity, technological investment, and educational initiatives to prepare both the market and the public for the inevitable digital transformation of finance.
Importantly, Longo acknowledged that innovation and regulation must evolve hand-in-hand. He stressed that while the regulatory environment must be flexible enough to accommodate innovation, it should also protect investors and maintain the integrity of financial markets. He suggested that sandbox initiatives, pilot projects, and controlled environments are essential tools to test new models without compromising market stability.
To support this transformation, ASIC is reportedly exploring potential frameworks for digital asset regulation that balance innovation with investor protection. This includes examining how tokenized assets can be integrated into existing financial systems and how risks—such as fraud, hacking, and market manipulation—can be mitigated.
The broader implications of tokenization extend beyond finance. Real estate, commodities, intellectual property, and even art can be tokenized, offering new liquidity options and expanding access to global markets. For Australia, embracing digital assets could also strengthen its position in fintech and attract international investment.
Moreover, the rise of central bank digital currencies (CBDCs) and institutional interest in blockchain are further accelerating the shift toward tokenized economies. Ignoring this momentum, according to Longo, could isolate Australia from one of the most significant financial evolutions in modern history.
As the world moves toward a more decentralized and digitized financial future, Longo’s message is clear: either Australia adapts now or risks becoming irrelevant in tomorrow’s global economy. He concluded his speech by urging immediate dialogue and decisive action to ensure the country does not miss out on the opportunities tokenization presents.
In the coming months, stakeholders across Australia’s financial landscape are expected to respond to this call, potentially shaping the nation’s role in the next chapter of financial innovation.