BlackRock executives say tokenization will unify crypto and traditional finance

BlackRock’s senior leadership is doubling down on its conviction that tokenization will become the key mechanism linking traditional finance with the crypto economy. In a jointly authored piece published in The Economist, CEO Larry Fink and COO Rob Goldstein wrote that tokenized markets will help merge the two worlds rather than replace the current financial system.

They compared the evolution of the space to two groups building a bridge from opposite sides of a river: established financial institutions on one side and digital-native platforms, stablecoin issuers, and public blockchains on the other. The goal, they argued, is not competition but interoperability. Eventually, investors may no longer separate digital assets from stocks or bonds, instead managing all holdings through a single digital wallet.

BlackRock, which oversees more than $13.4 trillion in assets, has already taken a leading role in the tokenization space. Its BUIDL fund, launched in March 2024, is now the world’s largest tokenized cash market fund with roughly $2.8 billion in assets. Fink, once a skeptic of cryptocurrencies, has increasingly advocated for the technology’s potential as tokenization has moved beyond hype and speculation.

He and Goldstein noted that traditional markets are beginning to recognize how tokenization can broaden the universe of investable assets and create efficiencies beyond what public equities and bonds currently offer.

Still, they emphasized that regulation will play a critical role. Policymakers, they said, need to modernize existing rules so that conventional markets and tokenized markets can operate alongside each other without unnecessary friction. Bond ETFs, which connected dealer-driven fixed-income markets with public exchanges, were cited as an example of a successful bridge between old and new market structures.

With spot Bitcoin ETFs now trading on traditional exchanges, the executives argued that the next step is ensuring regulatory consistency. Risk, they said, should be evaluated based on the nature of the asset rather than the technology behind it. A bond issued on-chain, in their view, should be treated the same as a bond held in a traditional system.