Over three years ago, BlackRock’s Larry Fink predicted that the “next generation for markets … will be [the] tokenisation of securities.” What was once a bold statement on the future of finance is today a commercial reality. Exchanges such as NASDAQ and the NYSE have begun developing tokenised securities capabilities and financial regulators in Hong Kong and Singapore are moving beyond experimentation – supporting real-value pilots, industry sandboxes, and the regulatory frameworks needed to scale tokenisation.
In May 2026, distributed tokenised asset value reached over $34bn, and on ground sentiment reflects that appetite too. 77% of asset managers in a recent survey by Calastone on tokenised distribution said tokenisation is a “key trend that justifies immediate action”.
Two distinct worlds are beginning to converge. Asset managers are turning to tokenised distribution as a gateway into digital assets, while a maturing decentralised finance (DeFi) ecosystem is seeking blockchain-native solutions for effective treasury management. Tokenisation has become the essential bridge between traditional finance (TradFi) and DeFi.
Why distribution comes first
The end goal for tokenisation involves digitalising the entire asset management value chain. However, the most straightforward entry point is distribution: issuing existing funds in tokenised form.
This approach tokenises the fund unit only, leaving the underlying fund structure, administration, and servicing unchanged. This then allows asset managers to access to new markets and investors without the cost and complexity of overhauling major infrastructure.
This model is already being implemented in practice. For example, Legal & General recently announced that its liquidity funds are now live in tokenised form on Calastone’s Tokenised Distribution Network, highlighting how existing fund ranges can be extended into digital channels without operational disruption.
This growing momentum is reflected in the data. Calastone’s research forecasts that tokenised fund AUM is set to grow 58-fold, from $4bn in 2024 to $235bn by 2029. Asia-Pacific is identified as a key growth market, with 85% of APAC asset managers embracing tokenisation compared to 77% in North America and 60% in Europe. Two-thirds of APAC managers intend to use digital distribution platforms and exchanges for tokenised fund distribution.
How DeFi demand is driving supply
This is a direct response to demand from the DeFi ecosystem. As DeFi platforms like stablecoin issuers have matured, so have their balance sheets. Tether, the largest stablecoin issuer, holds $137bn in US Treasury bills, making it a larger buyer than Germany, United Arab Emirates, Saudi Arabia and South Korea. Stablecoin payments sent from Asia represent the largest source of volume, accounting for about $245 billion in payments, or 60% of the global total, and is driven almost entirely by payments sent from Singapore, Hong Kong, and Japan.
However, these organisations are hamstrung by a lack of blockchain-based tools for treasury management. Calastone research found that 75% of DeFi platforms currently hold their cash in traditional money market funds (MMFs) or bank deposits. The pioneers of decentralised finance are still reliant on traditional asset management models, undermining liquidity, transparency and settlement speed.
Tokenised MMFs are a viable option, combining the security, safety, liquidity, and yield of traditional finance with blockchain-native benefits like flexibility, on-chain settlement, direct digital wallet integration, and stablecoin compatibility.
The vast majority (80%) of DeFi platforms believe tokenised MMFs could benefit their treasury management – not just as a tool to manage assets more effectively but also with client retention (75%) and investor attraction (40%).
This aligns neatly with asset managers’ own priorities: MMFs and private asset funds are the top products they want to tokenise.
Partnerships, speed, and flexibility
As tokenisation enters the mainstream especially here in Asia, asset managers are prioritising speed to market, choosing collaboration over building capabilities in-house.
There is a clear preference for working with third parties. For instance, 70% of managers view technology partners as a key priority, and plan to use intermediaries like digital fund distribution platforms (36%) or digital exchanges (34%) rather than going direct to investors.
This flexibility and prioritisation of speed to market extends to payment rails: the vast majority of asset managers plan to accept multiple options, including commercial and non-bank stablecoins, fiat cash, and cryptocurrencies, lowering the barrier to entry for different types of investors.
From gateway to growth
Regulatory uncertainty, legal considerations, and questions around ROI continue to impede adoption, with the vast majority of managers citing these blocking or limiting factors.
Yet momentum continues to build. Early successes and the rapid pace of inflows to tokenised funds is validating utility. Moreover, 65% of managers who have already launched a tokenised fund report benefits over traditional models, citing improved automation and the ability to reach new customers.
Meanwhile, regulation is evolving to support this new model. In Singapore, the Monetary Authority of Singapore (MAS) has introduced a stablecoin regulatory framework that differentiates regulated stablecoins backed by high-quality reserves from other crypto-assets, including unregulated stablecoins, which may have no fundamental value, or may not be backed by adequate reserves. The Hong Kong Monetary Authority (HKMA) also passed stablecoin legislation that mandates licensing, ample reserves and investor protections.
With tokenised distribution there is an immediate opportunity for asset managers to enter new markets and win new customers now, without disrupting operations. It creates a symbiotic relationship: asset managers gain a new acquisition channel, while DeFi platforms gain the sophisticated on-chain financial tools they need to mature.
Over time, this model has the potential to reshape how funds are accessed and allocated. As regulatory frameworks and market infrastructure continue to mature in Asia, tokenised distribution offers a scalable path into decentralised markets – one that preserves the governance, controls and operational discipline asset managers require.
