Standard Chartered: Tokenization May Lift DeFi to $2.7T

Standard Chartered forecasts that tokenization could expand assets held in decentralized finance to roughly $2.7 trillion by 2030 if regulators, institutions and infrastructure develop as expected. The projection appears in a research note published by the bank that models several adoption scenarios through the rest of the decade.

The report identifies tokenized securities, loans and property as the main asset classes that could move onto blockchains and into on-chain finance. Tokenization means creating a digital token that represents ownership of a real-world asset and recording that token on a distributed ledger.

Standard Chartered’s analysts cite three drivers for growth: improvements in blockchain infrastructure, rising institutional interest in digital assets, and clearer regulatory frameworks in key markets. The research explains how these factors can reduce frictions in trading, settlement and custody and make tokenized products easier to offer to traditional investors.

The note details mechanisms by which tokenization could increase participation. Fractional ownership can let retail investors buy slices of previously illiquid assets. Smart contracts can automate payments, distributions and compliance checks, shortening settlement times and cutting administrative steps. Tokenized assets can also be combined with other on-chain services such as lending protocols, automated market makers and yield strategies.

Stablecoins and institutional custody solutions are highlighted as links between traditional finance and crypto rails. Stablecoins can serve as a consistent on-chain medium for exchange and settlement, while regulated custody and token servicing from banks and custodians can address concerns about safekeeping and legal title, the report says.

The research lists legal and technical obstacles that could limit adoption. Questions remain over digital-asset ownership law, cross-border securities rules and blockchain interoperability. Operational risks named in the note include smart-contract bugs, platform outages and the challenge of reconciling on-chain records with existing registries.

On market structure, the report anticipates two possible effects: a fragmentation of trading venues if many token formats emerge, and deeper continuous liquidity if market participants agree on standards and settlement rails. For issuers, tokenized securities could lower distribution costs and widen investor access. For investors, fractional positions may alter portfolio construction and secondary-market trading patterns.

The $2.7 trillion estimate represents a scenario in which regulatory frameworks evolve, major asset managers and banks adopt token servicing, and stablecoin liquidity expands. The bank models a slower-adoption case that results in a smaller share of assets moving on-chain by 2030.

Standard Chartered recommends that financial institutions build internal tokenization capabilities, engage with regulators and run pilot projects to test operational and legal processes. The report situates tokenization as a potential phase in the broader digitization of financial assets, separate from the earlier growth of native crypto tokens and permissionless protocols.