- TD Cowen estimates on-chain capital near US$4.6 trillion since 2020 and projects it could exceed US$100 trillion within five years.
- The growth is driven by tokenisation, which cuts costs, enables 24/7 smart contract functionality, and reduces settlement windows for cross-border transfers.
- A State Street survey cited by the bank found that most institutions expect 10%−24% of their portfolios to be tokenised by 2030, reflecting strong institutional adoption.
TD Cowen estimates on-chain capital near US$4.6 trillion (AU$7.18 trillion) since 2020 and models a path above US$100 trillion (AU$156 trillion) within five years.
According to the bank’s analysts, there are several critical factors fueling the exponential growth, starting off with the fact that tokenisation cuts costs, reduces settlement windows for cross-border transfers, and allows assets to work 24/7 thanks to smart contracts, providing higher workflows aligned with existing post-trade pipes.
They say executives from JPMorgan, Bank of America, Euroclear, and Tradeweb described work to converge on common protocols. They also highlight staked assets such as ether as a yield source for on-chain capital formation.
To that regard, BNY Mellon is testing tokenised deposits to modernise payments, alongside Goldman Sachs.
Even the UK is planning a “digital markets champion” to lead tokenisation efforts, according to Bloomberg.
Related: Citi Steps Into Crypto: Banking Giant to Launch Digital Asset Custody by 2026
Expect More Portfolios Tokenised by 2030
The bank cited a State Street survey that showed most institutions expect digital-asset exposure to double within three years, with over half projecting that 10%–24% of portfolios will be tokenised by 2030.
The analysts stated that, despite some obstacles in the current landscape, there are some bottlenecks to overcome first.
While the path remains bumpy, political/regulatory progress has far exceeded what we had expected even two years ago. “On-chain capital formation could be US$100 trillion or more in five years, in our opinion. The trend is too big to ignore.
TD Cowen.Bitwise’s CIO Matt Hougan made similar comments a few months ago, stating that the transformation of real-world assets (RWA) is already having a massive impact both in traditional finance and crypto.
More institutions are embracing tokenisation, and Centrifuge’s recent record-breaking milestone is a reflection of that statement. The protocol recently surpassed US$1 billion (AU$1.53 billion), joining BlackRock’s BUIDL and Ondo Finance as the leading RWA projects.
Related: Amundi Eyes Bitcoin ETN Launch, Signaling Major Shift in European Institutional Adoption
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