Author: Jason Jiang, OKG Research
From Bitcoin spot ETF to the tokenization wave, institutional power represented by Wall Street is profoundly influencing and changing the direction of the crypto market, and we believe that this power will become stronger in 2025. OKG Research has launched the "#ChainOnWallStreet" series of research to continue to focus on the innovation and practice of traditional institutions in the field of Web3, to see how top institutions such as BlackRock and JPMorgan Chase embrace innovation? How will tokenized assets, on-chain payments and decentralized finance shape the future financial landscape?
This article is the first in the "#ChainWallStreet" series of studies.
When predicting the crypto market in 2025, investment management company VanEck boldly expected Coinbase to "take the unprecedented step of tokenizing its stocks and deploying them on its Base blockchain." The prediction seems to be coming true: Jesse Pollak, the main developer of the Base chain, recently revealed that providing $Coin on the Base chain is "something we are working on in the new year" and expects that "every asset in the world will eventually be on Base."
It’s not clear whether Coinbase can realize its plan, but as it uses its own stock as a starting point for tokenization exploration, Wall Street is also accelerating “Onchain”.
Wall Street Begins to Migrate to the Chain
Since 2024, the crypto market has experienced rapid growth and the boundaries of innovation have continued to expand. The core driving force behind this comes from the cryptocurrency spot ETFs promoted by Wall Street institutions represented by BlackRock. Today, these institutions are shifting more attention to the field of tokenization.
BlackRock CEO Larry Fink said that while the approval of crypto spot ETFs is important, these are "stepping stones" towards the broader tokenization of other assets. With the tokenization boom, Wall Street is pushing more assets and businesses to the chain, allowing traditional finance and crypto innovation to collide more sparks in the digital space.
Although the tokenization of financial assets has been happening since 2017, it has only taken off recently. Unlike early explorations that focused on permissioned chains, more and more tokenization practices are gathering on public chains, and Ethereum has become the first choice for institutional tokenization. These institutions no longer reject decentralization, but instead actively explore the impact radius of encryption, trying to provide a new experience by recombining assets and technologies. As Coinbase said, "Web3" is gradually being replaced by the more appropriate "Onchain".
Only this time, the protagonist is no longer just cryptocurrency, but also many assets from the physical world, such as stocks. As the largest cryptocurrency exchange in the United States, Coinbase is the most popular stock target in the tokenized market at this stage. According to rwa.xyz data, as of January 2025, the total market value of tokenized stocks is approximately US$12.55 million, of which nearly 50% are tokenized stocks with Coinbase as the target. In addition, stock tokens of Nvidia, Tesla, and Apple, among the seven giants of US technology stocks, also frequently appear on the chain.
Figure Tokenized Stock Market Structure
Coinbase plans to tokenize its stocks and issue them on the Base chain, which will not only allow investors to trade their stocks directly on the chain, but also further integrate the trading platform, Base chain and on-chain asset ecosystem, and explore a stock tokenization model that is compliant and feasible in the United States, allowing it to maintain its lead in the competition for crypto financial innovation.
This layout is definitely not just for the tokenization of $COIN. Perhaps, as Jesse Pollak said, they hope that all assets in the world are on the Base chain. But compared with this, accelerating the migration of major global assets to the chain through tokenization is a more foreseeable future.
Although tokenization, like other innovative concepts, is also subject to skepticism, the concept centered on democratizing access to investment opportunities and simplifying the efficiency of capital flows has been deeply rooted in people's minds. The on-chain availability demonstrated by stablecoins, BUIDL funds and other tokenized assets has proven its value, and more and more asset classes are also migrating to the chain: not only common private credit, bonds, funds and gold, but also assets such as agricultural products, carbon credits, and rare minerals.
According to the OKLink Research Institute, we will see Wall Street continue to frequently "Onchain" in 2025, and promote the tokenization system to be richer and more mature: not only will the scale of on-chain tokenized assets of non-stable coins exceed at least 30 billion US dollars, but we will also see more companies enter the tokenization field under the leadership of Wall Street and bring more valuable assets to the chain. Although the scale of tokenization of these assets may not be "exaggerated", it is still of great significance.
Towards a more democratized financial future
60 years ago, when you bought a financial security or pledged it as collateral, you might have to wait five days to receive a paper certificate to confirm the transaction. Later, as the number of paper certificates increased and transaction settlement became unmanageable, Wall Street was forced to begin trying to use computers to track securities.
Today, gaining competitive trading advantages from better or faster technology is a ubiquitous part of modern finance. Whether it is BlackRock and Goldman Sachs, or Citigroup and JPMorgan Chase, almost everyone on Wall Street has identified tokenization as the trend of the future and is embracing the changes brought about by tokenization. Compared with the passive financial informatization, tokenization is the next step of change that finance actively embraces.
In this transformation, it is no longer a problem to deploy assets on the chain through tokenization. The future challenge is how to increase the demand for tokenized assets and solve the liquidity problem on the chain. The unparalleled success of traditional securities is largely due to their high liquidity and low transaction costs. If tokenized assets are only locked on the chain or can only be traded in the secondary market with limited liquidity, their actual value will also be very limited.
Nadine Chakar, who was in charge of the digital asset department of State Street Bank, once expressed a similar view: "The bank works with a company to issue tokenized bonds and then issues a press release. What happens next? Nothing happens. These bonds are like stones and are difficult to circulate in the market."
How to solve the liquidity problem in the tokenized market? Different institutions may have different solutions, but in my opinion, the most direct way is to accelerate the tokenization of high-quality assets. Only by accumulating enough high-quality assets on the chain can we attract more users and funds to migrate to the chain, thereby solving the liquidity problem.
McKinsey predicts that the scale of tokenization will be close to 2 trillion US dollars by 2030
As network effects strengthen, tokenization is now moving from pilots to large-scale deployment. However, as McKinsey predicts, tokenization cannot be achieved overnight, and there will be a significant time difference in the tokenization process of different assets: the first wave will be driven by use cases with proven returns on investment and existing scale, followed by use cases for asset classes with smaller current markets, less obvious benefits, or requiring more severe technical challenges to be solved.
When the first wave of on-chain assets explores compliant and practical business models and brings enough attention and liquidity to the on-chain market, perhaps tokenization will create a freer and more democratic "shadow" capital market in the future. Giving investors more free investment opportunities and allowing more companies to complete financing more conveniently, tokenization will bring profound changes to both the supply and demand sides of assets, and gradually eliminate the barriers between the off-chain and on-chain worlds, forming a truly global new financial ecosystem.
