Wall Street Put $350 Billion on Blockchain; Most of It Is Doing Nothing

Not long ago, blockchain was a technology that Wall Street loved to mock. It was a ledger for Bitcoin speculators, but not for serious money. That has changed. Over the past three years, the largest names in finance have begun “tokenizing” the assets they manage. BlackRock runs a Treasury fund on a public blockchain. Franklin Templeton, Fidelity and JPMorgan have built their own versions.

Tokenizing an asset means creating a digital token on a blockchain that represents ownership of it, the way a stock certificate once did on paper. Because the token lives on a shared ledger rather than in one bank’s private database, it can, in theory, be transferred instantly, held in an ordinary digital wallet, pledged as collateral to any lender, and settled without the days of paperwork that still govern most of finance. Money can be sent as easily as an email, without needing to go through a broker.

However, the infrastructure we have built so far holds little resemblance to that promise. Most tokenized assets today can be bought from their issuer and sold back to their issuer. That’s all. They cannot be traded on an exchange, moved to a wallet the issuer does not control, or used as collateral anywhere else. The European Central Bank (ECB) issued a bulletin in April 2026 warning that although digital asset issuance has increased dramatically, there is still a stark lack of on-chain liquidity.

Modern tokenization is equivalent to scanning your paper stock certificate into a computer but still having to visit one particular branch of one particular bank to do anything with it. Our records are becoming digital…but what’s the advantage for users?

The Industry Is Focused on the Wrong Metrics of Success

If tokenized asset usage is stalling, it’s fair to ask why the coverage has been so triumphant. Reports of a tokenization boom are everywhere: banks are issuing research notes, consulting firms are forecasting a market worth many trillions by 2030, and executives on earnings calls are describing the technology as the future of their firms.

We’re seeing this disconnect because the industry has chosen a flattering way of keeping score. Industry leaders primarily track how much traditional asset value has been recorded on blockchains, and the totals have grown fast enough to look like proof of adoption. But the number they report is a count of what has been issued, not what is being used.

By that measure, roughly $359 billion in assets are now on-chain in some form. Only about $31.5 billion of it can actually move, meaning it can change hands on an open market, be held outside the issuer’s platform, or be pledged to a third party. That is an 11-to-1 gap between the figure that gets cited and the portion that does what tokenization was supposed to do.

What to Watch Instead

The better question is not how many assets have been tokenized, but how much is in motion—and here there are encouraging signs.

Since March 30, 2026, the ECB and the national central banks of the euro area have accepted qualifying securities issued on blockchain systems as collateral for the loans they make to commercial banks. This is a bigger deal than it sounds. Which assets a central bank will accept as collateral is among the most conservative judgments in finance, and until this year, tokenized securities were not on the list. Now a bond issued on a blockchain, provided it comes through a regulated depository and meets the ECB’s usual standards, can be pledged to the same institution that accepts German government debt. The token has left home and been put to work somewhere its issuer does not control.

This obviously raises new concerns: unknown buyers, sanctioned wallets and securities turning up in countries where they were never approved for sale. However, we can easily engineer solutions to these problems. A token can carry its own rules. It can hold a list of who is allowed to own it, check each transfer against sanctions screens, and refuse to settle in a jurisdiction where it lacks permission. There are ways we can take full advantage of tokenization without eschewing compliance.

So the useful metric for the next few years is circulation. Can a tokenized asset be sold to someone other than the firm that issued it? Can it be pledged to a lender that firm does not own? Does it trade in a market with more than one participant? Companies have the technology to answer yes to all three questions. What’s missing is the will to use it.

Wall Street spent the last three years proving it could put $350 billion on a blockchain. The next three should be spent proving it was worth the trouble.

Emily Bao is a key advisor to Mantle, the company enabling borderless access to capital markets. She operates at the intersection of centralized and decentralized finance, connecting exchange-native liquidity infrastructure to onchain markets. Emily is also the spot executive of Bybit.