Hong Kong – Tokenization is gaining traction, but its success depends less on market hype and more on real-world utility, say executives from Ondo Finance and Securitize.
“There is no shortage of companies, of issuers, of companies that are interested in tokenization,” said Graham Ferguson, head of ecosystem at Securitize, during a panel discussion at Consensus Hong Kong. “But it’s up to us to figure out how to distribute these assets on-chain via exchanges in a way that’s compliant with the law globally.”
Ferguson emphasized that despite great interest from the institutional side, distribution and compliance remain the bottlenecks. “The biggest issue we face is communicating with exchanges and DeFi protocols about the requirements necessary to comply with our obligations as a regulated entity,” he said.
Securitize has partnered with firms such as BlackRock to tokenize real-world assets, including US Treasuries. Launched in 2024, BlackRock’s BUIDL fund now has over $2.2 billion in assets, making it the largest tokenized treasury fund on the market.
Ondo Finance, which also focuses on tokenized government bonds and exchange-traded funds (ETFs), has about $2 billion in total value locked (TVL), according to data from rwa.xzy. Min Lin, Ondo’s managing director of global expansion, said tokenized government bonds today are a fraction of the potential market.
Both speakers emphasized that the next phase of tokenization will be driven by what users can actually do with tokenized assets. Ondo recently enabled tokenized stocks and ETFs to be used as margin collateral in DeFi perpetuals — a first, Lin said.
“It brings a lot more capital efficiency in terms of the utility of these tokenized assets,” he added.
Ferguson agreed, arguing that technological advantages such as programmable compliance and rapid settlement are not enough by themselves. “Utility is definitely far and away number one,” he said. “That’s what will drive the next phase.”
