Fidelity International's Giselle Lai highlights that the main advantage of tokenized funds is their potential for effective balance-sheet management in large institutions.
During her remarks at the WebX conference in Tokyo, Giselle Lai, a director and digital assets strategist for APAC at Fidelity International, pointed out that while liquidity is important, the real long-term value of tokenization lies in enhancing balance-sheet management. She stated, "I believe that over time, balance sheet management will emerge as the more attractive application."
Large corporations often face challenges related to maintaining cash across various global accounts to comply with regulations and manage risks, with many deposits yielding no returns. Tokenized assets could streamline this process, enabling businesses to manage liquidity more effectively across jurisdictions.
Current offerings of tokenized funds, particularly those linked to money market instruments supported by U.S. Treasuries, have gained traction, with BlackRock's USD Institutional Digital Liquidity Fund, launched in March 2024, leading the way with over $15 billion in assets under management. The overall market for on-chain real-world assets has surpassed $31 billion, while the asset tokenization sector could potentially grow to $24.5 trillion by 2033, and even reach $88 trillion by 2035, according to Grand View Research.
