Nasdaq CEO: Tokenization could unleash tens of billions of dollars

Nasdaq CEO Adena Friedman has estimated that tokenizing assets could free up tens of billions of dollars in capital currently tied up as collateral across the global financial system. Friedman shared these insights at the TOKEN2049 conference in Singapore.

Tokenization, which involves representing assets like Treasurys and equities as digital tokens transferable via blockchain technology, is expected to enhance the liquidity of collateral. This increased fluidity could lead to more efficient capital movement between financial institutions.

Friedman noted a growing institutional interest in tokenization, partly influenced by recent regulatory frameworks for stablecoins in the U.S. However, a shift to 24/7 trading would necessitate substantial upgrades to financial infrastructure, with artificial intelligence likely playing a key role in real-time risk management.

Companies outside the U.S. are also exploring tokenization and seeking greater access to American capital markets, according to Arjun Sethi, co-CEO of cryptocurrency exchange Kraken. He suggested that tokenization could expand capital market access for businesses worldwide.

While not all assets may be suitable for continuous 24/7 trading, Friedman indicated that enhanced connectivity within the global financial system could potentially open access to previously out-of-reach asset classes for some investors.