Why do tokenized assets still require traditional cash settlement?
2026-09-06 20:52:30
According to CoinMeta, the rise of tokenized assets promises to transfer financial assets such as stocks, bonds, and funds onto blockchain networks. However, merely putting assets on the blockchain does not solve all the issues related to transactions. When investors purchase tokenized government bonds, the seller must deliver the securities, while the buyer needs to pay in cash, which raises an important question: what currency can truly be used to pay for tokenized assets? Traditional financial markets address this issue through counterparty payment. Blockchain technology has the potential to accelerate this process, allowing tokenized systems to exchange both securities and cash simultaneously. Stablecoins, tokenized bank deposits, and tokenized central bank money are the three main candidates for serving as cash in the tokenized market. Stablecoins are widely available on public blockchains, and tokenized government bonds can be exchanged for dollar-backed stablecoins without leaving the blockchain. Tokenized bank deposits represent a tokenized form of existing commercial bank deposits, allowing customers to transfer their deposits through programmable digital infrastructure. Tokenized central bank money is particularly important for large financial institutions, as central bank reserves are at the core of traditional settlement systems. As tokenization continues to expand, it becomes increasingly crucial to ensure that different forms of currency can interact safely with each other.
Bullish 0
Bearish 0
Source:Coinpaper
This content is for market information only and does not constitute investment advice.