Fidelity: Institutions Can’t “Go Back” as Tokenization Builds an On-Chain Future

Tokenization is moving from a niche experiment to a mainstream infrastructure conversation, with leading financial firms arguing that the next growth wave will be driven by onchain market plumbing—custody, settlement, and distribution—rather than by retail speculation alone.

Speaking during a panel at Longitude Singapore on Thursday, Matthew Horne, head of digital asset strategists at Fidelity Investments, said institutional momentum toward an “onchain future” is difficult to reverse, framing tokenization as a route to broader investor access and new market reach.

Key takeaways

• Fidelity’s Matthew Horne argued institutional push toward an onchain future is becoming irreversible, with tokenization helping asset managers access new investor markets.


• RWA.xyz data shows demand for tokenized real-world assets rose 41% over the past 30 days, with holder counts reaching 493,000 addresses (excluding stablecoins).


• UBS’s Ka Yan Chan said treasuries and equities could unlock “billions to the trillions” if regulators and market infrastructure providers modernize custody into a tokenized platform.


• Recent regulatory steps referenced by the panel include an SEC “no action” letter for a DTCC subsidiary’s tokenization service and a temporary exemption for limited trading of tokenized U.S. stocks.


• OnchainBenchmark reported more than $1.2 billion moved onchain in the past 30 days, lifting total onchain capital across stablecoins and tokenized assets to over $323 billion.

Institutional momentum and the push to broaden access

Horne’s central message was that tokenization is increasingly viewed within large institutions as a structural shift, not a temporary trend. He pointed to the past 18 months of progress and activity, arguing that once “true institutions” commit to moving assets and processes onchain, the industry’s direction becomes harder to unwind.

For U.S. asset managers, Horne said tokenization offers incentives that go beyond custody experimentation. Tokenized products can make it easier to reach different investor segments and potentially expand distribution into markets that are difficult to serve through traditional formats.

That demand signal is visible in address-level growth. According to RWA.xyz, demand for tokenized assets increased 41% over the previous 30 days. The platform reported that the number of holders reached 493,000, measuring total addresses holding tokenized real-world assets and excluding stablecoins.

While holders and addresses do not automatically translate into long-term profitability, they can be a useful early indicator of product onboarding—especially for tokenized funds and instruments where distribution and access are the gating factors.

Why treasuries and equities are the “next scale” target

UBS’s Ka Yan Chan broadened the discussion from asset managers to market structure, arguing that some of the largest onchain opportunities sit in the portfolio-building staples—treasuries and equities. In Chan’s framing, the biggest leap in adoption depends on whether the core infrastructure layers move first.

“What would really drive the billions to the trillions is when market infrastructure players like the Fed or DTCC make the first move in transforming the custody layer to a tokenized platform.”

Chan suggested that once custody and settlement systems are designed for tokenized instruments, other industry participants can “piggyback” by building distribution and related services for tokenized assets. This shifts the competition toward product access, onboarding workflows, and trading/transfer experiences—areas where issuers and platforms can differentiate.

That matters because tokenization’s friction is often concentrated in the infrastructure. Without broad, compliant pathways for holding and transferring securities-like instruments, new products can face bottlenecks in scalability. The implication of Chan’s comments is that the market’s next expansion may be less about new token issuances and more about enabling the pathways that allow many issuers to reach more investors.

Regulatory milestones shaping onchain securities trading

The panel’s infrastructure thesis was paired with references to regulatory movement in the U.S., which participants noted as a practical catalyst for tokenized-market activity.

In December 2025, the U.S. Securities and Exchange Commission (SEC) issued a “no action” letter to a subsidiary of the Depository Trust and Clearing Corporation (DTCC), allowing it to offer a tokenization service. Earlier on Thursday, the discussion also pointed to developments in tokenized equities, noting that in September the SEC approved a temporary exemption permitting limited trading of tokenized U.S. stocks on certain onchain venues.

Earlier coverage cited in the source also noted that the exemption enables constrained trading activity, rather than full, blanket approval for every tokenized security use case. In the same period, Securitize announced the launch of trading of tokenized shares tied to a dozen widely held U.S. stocks, with security entitlements.

For investors and builders, the key question is not only whether tokenization is being allowed, but what forms of trading and custody are considered acceptable under regulators’ current frameworks. These distinctions affect everything from compliance workflows to how liquidity is structured across venues.

Capital flows show increasing onchain activity—mostly underwritten by stablecoins

Beyond tokenized real-world assets, onchain activity across the broader ecosystem is also rising. According to OnchainBenchmark, more than $1.2 billion in capital moved onchain during the past 30 days. The same dataset indicated the cumulative total across stablecoins and tokenized assets exceeded $323 billion.

This broader measure matters because stablecoins currently represent much of the liquidity used for onchain settlement. Tokenized RWAs may be growing faster in certain segments, but stablecoins often provide the immediate rails that make onchain transfer efficient and liquid.

The panel also referenced industry forecasts for the RWA segment. Standard Chartered’s global head of digital asset research, Geoff Kendrick, predicted in August that tokenized RWAs could reach $4 trillion by the end of 2028. Such forecasts typically depend on whether the infrastructure and regulatory pathways mature fast enough to support issuance at scale and enable easier transfer and settlement across institutions.

For market participants, the near-term watch items are clear: whether tokenized treasuries and equities progress beyond limited pilot trading, how custody and settlement standards evolve, and whether holders continue to grow as measured by platforms tracking tokenized asset address counts.

As regulatory clarity slowly expands and infrastructure providers position tokenized custody as the next competitive battleground, the next phase of tokenization adoption may hinge less on new token launches and more on whether institutions can scale distribution, compliance, and settlement without sacrificing operational reliability.

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