Fund issuers are actively investigating blockchain-based ETFs due to concerns about losing early access to tokenized finance.
By Helene Braun|Edited by Cheyenne Ligon Jun 23, 2026, 4:34 p.m. 2 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShow- Asset managers are hastening efforts to tokenize ETFs due to growing investor interest and worry about missing early opportunities in blockchain finance.
- BNY indicates that firms are proceeding with tokenized fund offerings despite ongoing uncertainties regarding regulation, trading platforms, and market frameworks.
- Issuers are increasingly facing reputational risks as third parties create tokenized versions of established ETFs that trade outside conventional financial markets without their consent.
As the industry transitions from experimentation to commercial viability, asset managers are eager to secure their position in the emerging market.
Ben Slavin, the global head of exchange-traded funds (ETFs) at BNY, mentioned in an interview, "We have a number of different projects in flight, different variants to effectively tokenize ETFs."
This trend coincides with significant companies such as BlackRock and Franklin Templeton exploring methods to integrate traditional financial products onto blockchain platforms, enabling fund shares to be traded as digital tokens.
Although many of the currently launched tokenized products focus on money market funds, Slavin noted that interest is broadening beyond cash-management offerings.
"What is interesting about it is I think a lot of clients feel like there is an opportunity there to raise assets," he stated. "A lot of them really have a 'FOMO' effect, where they want to get in early."
This momentum persists despite many pivotal questions remaining unanswered, as asset managers continue to debate how tokenized funds will interact with existing fund infrastructures, the mechanics of secondary trading, and the regulatory landscapes that will govern these products.
However, Slavin expressed that firms seem unwilling to delay. "Even though the regulations and the rails aren't fully ready yet, they want to get products out," he remarked.
Wall Street anticipates that blockchain networks could eventually serve as a novel distribution channel for traditional investment products. Tokenized funds might allow investors to hold and transfer shares continuously, potentially shortening settlement periods and broadening access to a global investor base.
Slavin pointed out a growing concern for fund issuers: tokenized versions of popular ETFs are already being traded on platforms outside of conventional financial markets, often without the direct involvement of the fund sponsors themselves.
"There are ETFs, like hundreds of them, that are trading in unregulated markets around the world," he explained.
As anyone can potentially create a tokenized representation of a publicly traded fund, issuers must contend with the possibility of products displaying their names circulating without their oversight.
"It's opaque," he said. "It effectively creates a reputation risk, even though it's not at all affiliated, frankly, with the asset manager."
This issue has become an increasingly important topic among BNY's asset-management clients as they assess their own tokenization strategies. Similar to the early days of bitcoin and cryptocurrency trading, the technology is advancing more rapidly than the regulations that govern it.
Nevertheless, Slavin noted that asset managers are increasingly recognizing tokenization as a domain where being an early mover may outweigh the benefits of waiting for complete clarity.
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In May, combined exchange volumes fell 3.45% to $4.41T; the lowest since September 2024. RWA perpetual futures volumes rose 10.4% against the trend, hitting a new all-time high.
By CoinDesk ResearchJun 15, 2026In May, combined exchange volumes fell 3.45% to $4.41T; the lowest since September 2024. RWA perpetual futures volumes rose 10.4% against the trend, hitting a new all-time high.
Why it matters:
In May, combined exchange volumes fell 3.45% to $4.41T; the lowest since September 2024. RWA perpetual futures volumes rose 10.4% against the trend, hitting a new all-time high.
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