Tokenization is the next chapter of capital market infrastructure. The United States should lead it.

By Summer Mersinger

Tokenization represents the next phase in the modernization of capital market infrastructure and a critical opportunity for the United States to lead in building the next generation of financial markets.

To help ensure this next generation of market infrastructure is built in the United States, Blockchain Association is launching a Tokenization Workstream. This initiative will bring together industry leaders to engage directly on policy, support responsible development, and help shape the future of tokenized capital markets.

Tokenization is the process of representing traditional financial assets on blockchain networks so ownership, transfer, and related market functions can operate on more modern, programmable rails. Tokenized securities are still securities – but the infrastructure beneath them can look very different from the siloed, batch-based systems markets have relied on for decades.

Just as the transition to electronic trading in the 1990s made financial markets faster and more efficient, tokenization represents the next step in that evolution. The question now is whether the United States will lead this transition as it has in the past.

Tokenization can support faster settlement, more transparent records, more efficient collateral and liquidity management, and more modern compliance and transfer mechanisms. It also opens the door to a more interoperable and responsive financial system – one that can move assets across markets with less friction.

This is not a niche crypto issue. It is a broader question about how U.S. capital markets will operate in the years ahead and whether the underlying infrastructure will be built here under U.S. rules and institutions.

Tokenization also advances two goals that should have broad bipartisan appeal. It can expand access to investment opportunities for ordinary Americans by lowering barriers to entry and enabling fractional ownership. And it can help keep U.S. capital markets the most competitive in the world by improving efficiency and supporting next-generation financial infrastructure.

At the same time, it raises important policy questions. Tokenized securities remain subject to the securities laws, but those laws must be applied in a way that reflects how blockchain-based infrastructure actually works. That includes recognizing the distinction between traditional intermediaries and onchain systems that do not exercise custody, control, or discretion over user assets.

There has already been meaningful progress. The SEC has the tools to support responsible innovation, including exemptive relief and iterative regulatory pathways it has used to accommodate new market structures in the past.

But the direction is clear: tokenization infrastructure will develop regardless. The real question is whether it develops inside the United States or outside it.

This week, we engaged on these issues through testimony before the House Financial Services Committee. The Tokenization Workstream will build on that engagement – providing a practical forum for members to contribute expertise, shape BA’s policy work, and support the responsible development of tokenized securities and onchain market infrastructure.

If we get the policy right, the United States can lead in building more efficient, accessible, and resilient capital markets. If we get it wrong, that infrastructure will be built elsewhere.