Author: Payment 201
Speaker: Pet Berisha (Co-founder of Tokenized)
Guests: Rob Hadick (Dragonfly GP), Robert Mitchnick (Head of Digital Assets at BlackRock), Noah Levine (Partner at Andreessen Horowitz)
Timeline:
00:00 Introduction
02:17 Tokenization is fundamentally a story about "access," enabling more investors to reach asset classes that were previously difficult to access.
05:51 Tokenized equity can generally be divided into three structural types.
Under the whitelist mechanism, tokenized assets have certain restrictions on transferability.
11:21 New York Stock Exchange partners with Securitize to explore 24/7 trading models.
15:00 Stablecoins are evolving into the next-generation financial infrastructure.
18:58 U.S. regional banks are building a tokenized deposit network.
24:21 Stablecoins and tokenized deposit services serve different types of users.
25:42 Demand for privacy in on-chain capital markets is growing significantly.
31:06 The future market structure will reduce intermediary steps and become more flattened.
Stablecoins are evolving from “payment tools” to “account-layer infrastructure.” Users are no longer just using them for transfers, but holding balances directly—this naturally extends to investment, yield management, and asset allocation. For financial products, stablecoin wallets will gradually replace traditional accounts as the entry point.
The greatest value of tokenization is not increased efficiency, but expanded investment access. It enables users who previously participated only in the crypto market to access a broader range of traditional assets, while also allowing more investors worldwide to enter a unified market—essentially expanding demand-side participation rather than optimizing supply-side efficiency.
Most "tokenized stocks" currently on the market are still in a transitional form, essentially repackaged derivatives rather than real assets on-chain. Issues such as inconsistent trading hours, inability to redeem in real time, and unclear asset ownership indicate that the underlying infrastructure for true on-chain capital markets has not yet matured.
The truly valuable model in the future is "native on-chain issuance," not mapping off-chain assets onto the chain. Only when assets are directly created, traded, and settled on-chain can new capabilities such as collateralization, composition, and governance be unlocked—this is where structural change begins.
Whitelisting and compliance restrictions are the core bottlenecks to liquidity in tokenized assets today. As long as assets must be transferred only between restricted addresses, true liquidity and DeFi composability cannot be achieved. The industry is seeking solutions that satisfy regulatory requirements without sacrificing liquidity.
7×24 trading is not the core demand; the real need lies in "asset utilization efficiency." After holding stablecoins, users don’t just want to trade at any time—they want these funds to seamlessly participate in investment, lending, yield, and other scenarios, which is the key driver of tokenization growth.
Stablecoins and tokenized deposits do not replace each other but serve different use cases. Stablecoins are better suited for cross-border transactions, crypto markets, and dollarization needs, while tokenized deposits are more focused on internal fund transfers and efficiency improvements within the banking system. In the future, a multi-form structure of funds will coexist.
The core obstacle preventing banks from driving tokenization is not technology, but regulatory uncertainty. Issues such as AML, compliance frameworks, and capital requirements remain unclear, causing banks to proceed cautiously—even as they recognize this is a transformation they must participate in.
Privacy is becoming a critical infrastructure requirement for on-chain capital markets. While it can be circumvented in payment scenarios through methods such as netting, it cannot be replaced in use cases like collateralization, liquidation, and trading; therefore, technologies like ZK will be prioritized for deployment in capital markets rather than payment systems.
Over the long term, the structure of financial markets will become significantly flatter. Current trading involves numerous intermediaries (brokers, exchanges, clearinghouses, custodians, etc.), but tokenization can compress these layers. The result is lower costs for investors, expanded reach for asset managers, and new opportunities for crypto infrastructure to integrate into mainstream finance.
Pet Berisha:
Welcome to Tokenized, a show focused on stablecoins and institutional adoption of tokenized real-world assets. This episode was recorded live at the Digital Assets Summit in New York. That was pretty good. Hi everyone, I’m Pet Berisha, filling in for Simon this week—though at least my accent is still about the same. Joining me is a guest who’s always fantastic and may have just tied the record for most appearances on the show, Rob Hadick from Dragonfly. How are you?
Rob Hadick:
I'm fine, and it's clear I'm not as skilled as you, since I didn't say the entire opening line last time.
Pet Berisha:
Well, it’s just a matter of practicing more.
Rob Hadick:
Yes, it's all about practicing more. Okay, I'll need to do this a few more times.
Pet Berisha:
Also joining us for the first time is Robert Mitchnick, Head of Digital Assets at BlackRock. Welcome to the show.
Robert Mitchnick:
Thank you for the invitation.
Pet Berisha:
Wow, there’s applause again—you didn’t get that, Rob. I’m not sure why. And finally, equally important, over there in the coat, trying to channel Cuy Sheffield’s style: Noah Levine, partner at Andreessen Horowitz and a member of the so-called “Visa crypto gang.” How are you?
Noah Levine:
Great, I'm excited to be here.
Pet Berisha:
This is my second time on the show. Next, I’m going to cover a section everyone tends to skip, but I need to remind you: all opinions expressed by today’s guests are their own and do not necessarily reflect the positions of their respective companies. Nothing we say should be construed as tax, financial, investment, or legal advice—please conduct your own research. We also extend our sincere thanks to today’s sponsors, Visa and Mesh, and to Mentox Global for helping us organize this event.
This episode is sponsored by Visa, a leader in digital payments. Visa’s tokenized assets platform, VTAP, uses smart contracts and cryptography to help banks bring fiat currency on-chain. Whether issuing stablecoins, deposit tokens, or other forms, VTAP enables financial institutions to issue fiat-backed tokens, enhancing financial efficiency and enabling programmable finance.
Pet Berisha:
This episode is also sponsored by Stripe. Stablecoins are becoming the foundational building blocks of borderless financial services, enabling funds to flow globally like data. With Stripe, you can reach new user segments using stablecoins and cryptocurrency, reduce cross-border fees, and cut settlement times from days to minutes.
Most importantly, it works the same way as other Stripe products—directly through the Stripe dashboard via API—meaning you don’t need to worry about which blockchain or wallet is being used. From Shopify to other global enterprises, businesses are using Stripe’s full crypto solution to expand their markets and reach more customers.
Pet Berisha:
This episode is also sponsored by M0. Stablecoins are becoming the global financial infrastructure, and this infrastructure needs to mature. If you’re a brand, you should own your own stablecoin—one that aligns with the flow of funds in your product. If you’re an issuer, you want to be the stablecoin partner of the most valuable brand. M0 is the only platform today that enables issuers and brands to co-build digital currency products together.
Pet Berisha:
Let’s move to the first topic. A news item from various sources: Larry Fink said that tokenization can make investing as simple as paying with a mobile phone. In his annual letter, he stated: Half the world’s population already uses digital wallets on their phones—imagine if those same wallets could make investing in a basket of companies as easy as sending a payment.
Tokenization can accelerate this future by upgrading the underlying infrastructure of the financial system, making investments easier to issue, trade, and access. Robert, let me start with you. The reactions to this statement have been interesting—could you elaborate?
Robert Mitchnick:
Yes. I think this is actually consistent with some of his views over the past few months, even years, and similar to his article in The Economist last November. The core idea is: we’ve always framed tokenization as a story about efficiency gains, but in many ways, it may be more fundamentally a story about access.
There is a class of investors who are crypto-native or more accustomed to using digital wallets and interacting within digital assets and the DeFi ecosystem, but whose current allocations in traditional investments are severely underrepresented—or even 0%. The question then becomes: how can we expose them to a broader range of investment opportunities beyond today’s approximately $3 trillion crypto asset market, and instead tap into the entire $400–500 trillion global asset pool? I believe this represents a tremendous opportunity for financial inclusion, helping people build more complete and diversified portfolios.
Pet Berisha:
Rob, could you expand a bit more on the “access” angle? Why does tokenization not only enable crypto-native users to diversify their portfolios, but also improve access for retail and institutional investors?
Rob Hadick:
Alright. I might have a slightly different perspective than Robbie—he might say I’m wrong. From our point of view, we’re now seeing stablecoins rapidly gain global adoption, often because people want access to the U.S. dollar—like in countries experiencing 30% or 40% annual inflation, where individuals simply want to escape their local currency and move into the dollar system. But stablecoins have effectively become a form of “digital oil,” enabling the movement of capital between different tokenized assets. When these assets are all denominated in something similar to stablecoins, exchanging between them becomes significantly easier.
The issue is that if you're in an emerging market and want exposure to a particular stock, the regulatory approvals, infrastructure, and structural requirements are extremely complex and costly. As a result, many people resort to “workarounds,” such as tokenized stocks like those offered by Robinhood—which are essentially derivatives: a U.S. brokerage buys the stock during regular trading hours and then issues a corresponding token, which in some cases cannot even be minted or redeemed.
So many current solutions are merely transitional, forms of regulatory arbitrage, rather than true assets of the same “form.” Once these assets are unified into a single form, technical and access barriers can be broken down—what remains is merely a regulatory issue—and as a venture capitalist, I typically tell my companies that this is a problem you can address later.
Pet Berisha:
Noah, I was planning to ask you about this in the next topic, but since Rob brought up these derivative structures, could you help everyone clarify the different structures for tokenized stocks currently in the market?
Noah Levine:
Sure. I may not explain it as well as Rob and Robbie, but I’ll do my best. It can generally be divided into three categories. The first is the SPV (Special Purpose Vehicle) structure. You’ll see someone set up an SPV to purchase a stock asset, then tokenize that SPV and distribute it to a group of investors.
Its value lies in the fact that if you simply want exposure to price direction, it’s a useful tool. But the issue, as Rob previously mentioned, is that if this product is traded for 7 days while the underlying market is only open at specific times, price mismatches can occur. Additionally, as an investor, you’re buying the SPV, not the underlying asset itself, which carries its own risks.
The second type is "rights-based tokens," similar to what DTCC or Securitize do. The underlying assets are issued off-chain and then tokenized, allowing wallet users to hold and gain exposure. The advantages include 24/7 trading and a degree of DeFi composability, improving asset liquidity efficiency. Of course, there is still room for improvement.
The third category consists of stocks issued entirely on-chain, such as what Superstate and Figure are doing. In this case, entirely new securities are issued on-chain, and holding the asset means you truly own the underlying stock. Advantages include the ability to use cross-collateralization and participate in governance voting. So it’s not just about moving existing assets onto the chain, but about issuing assets natively on-chain from the start—an extremely exciting direction.
Noah Levine:
I’d like to ask Robbie a reverse question. You’ve made many tokenization attempts, such as tokenized money market funds, and also explored models like Securitize (using an SPV and KYC, then mapping to the blockchain without free transferability). How do you see the future—such as more freely transferable assets, or even native on-chain issuances like Superstate—fitting into your strategy?
Robert Mitchnick:
To clarify, our product is neither an SPV nor a feeder fund, but a native new fund whose shares are issued directly as tokens. However, transfers are still restricted—for example, they must occur only between parties on a whitelist, as required by private fund regulations and anti-money laundering rules. This is a significant issue: as long as a whitelist exists, it creates substantial friction, impairing liquidity and DeFi usability. The entire industry is therefore grappling with how to solve this problem without simply engaging in regulatory arbitrage and seeking forgiveness afterward.
Pet Berisha:
I’d like to follow up on this question. Noah, what are your thoughts on how we get to a more open, near permissionless state?
Noah Levine:
That’s a great question. I think there are two key aspects. First is regulatory clarity, which is crucial—and we’ve only just begun; for example, there have been significant developments in U.S. securities regulation over the past month. Second is infrastructure: platforms like Superstate and Figure currently rely on ATSs (Alternative Trading Systems) to provide liquidity and trading, which is viable in the short term, but further development is needed to scale toward broader institutional adoption. So the core lies in sustained regulatory clarity combined with enhanced liquidity infrastructure.
Pet Berisha:
Let’s move on to the second topic. An exclusive story from The Wall Street Journal: The New York Stock Exchange is partnering with Securitize to develop a 24/7 tokenized securities platform. Securitize will become the first digital transfer agent capable of issuing blockchain-native securities for companies or ETFs. Rob, could you break this down for everyone?
Rob Hadick:
Let me start with this, then move on to a larger trend. Everyone now believes in tokenization, and there are several reasons for this—one of the most important being: we want to enable trading over weekends and during nighttime hours. While market makers do attempt to hedge positions at night, these hedges are often imprecise. Especially over weekends, it’s nearly impossible to effectively hedge risk. If you want to manage collateral or use leverage over the weekend, you need on-chain infrastructure. That’s why everyone is now exploring different solutions.
For example, the New York Stock Exchange might use a separate order book, similar to a new exchange; while Nasdaq may prefer to trade tokenized assets alongside traditional assets in the same market; others are experimenting with introducing tokenized assets into dark pools. In short, everyone is exploring different paths—and this is beneficial for the entire industry, as it drives more innovation. In my opinion, ultimately, all assets will be tokenized.
Pet Berisha:
Robbie, do you agree?
Robert Mitchnick:
I believe this is a event with a fairly high probability of occurring, though not certain. Even if the probability isn't 100%, as long as it's sufficiently high, it justifies allocating substantial resources to prepare for it. Because if it happens, it will have a profound impact on the entire financial system, value chain, and market structure—including transforming the role of intermediaries.
Pet Berisha:
Noah, many people are saying 2025 will be the year of stablecoins, and 2026 will be the year of capital markets—what are your thoughts?
Noah Levine:
I largely agree. I remember Cuy’s statement last year that “every bank needs a stablecoin strategy.” Now, stablecoins have shifted from a “whether to do it” question to a “must do” imperative. The real question going forward is this: if users’ funds are in a stablecoin wallet, they don’t just want to check balances or make payments—they want to do more, like investing. I believe this is the true growth driver for tokenized assets, not just 24/7 trading itself.
Robert Mitchnick:
And I believe the applications of stablecoins have only just begun. While they have already gained some traction in cryptocurrency exchanges and DeFi, their use in cross-border remittances, corporate treasury management, capital markets, and other areas has barely scratched the surface, leaving significant room for growth.
Pet Berisha:
We move on to the third topic. As we mentioned in last week’s episode, U.S. regional banks are building a tokenized deposit network called Kari Network using ZK Sync, with participants including Huntington, First Horizon, M&T Bank, KeyCorp, and Old National Bank. The network is planned to launch in 2026 and will operate on ZK Sync’s permissioned chain. Rob, what are your thoughts on this?
Rob Hadick:
I think the current discussion about “stablecoins versus tokenized deposits” is somewhat missing the point. Fundamentally, we have cash equivalents and non-cash equivalents. Regulators have begun to consider how rules like Basel and capital requirements might be redefined, and the U.S. government has recently suggested treating stablecoins similarly to cash equivalents, which could aid capital management. I believe these different forms of assets will ultimately serve distinct purposes.
For example, so-called payment stablecoins might be a tool for fund transfer; tokenized deposits could be another tool; and tokenized money market funds yet another. They will increasingly resemble today’s financial products, but be more digitally native, easier to exchange with one another, and more liquid, while reducing the complexity of back-office reconciliation. From my perspective, the question of “who replaces whom” is not that important.
Pet Berisha:
What about the bank consortium model? In particular, what are your thoughts on it for mid-sized banks?
Rob Hadick:
Historically, there have been many successful banking consortia, such as Visa, Mastercard, and Early Warning (which later developed Zelle), as well as examples like Synchrony. So I truly believe that certain core infrastructure is better built through consortia, because it would be extremely difficult for a startup to meet the needs of so many banks simultaneously. You have to excel at many things at once, not just one. Therefore, I believe banking consortia will play a crucial, even essential, role in future capital market innovations.
Robert Mitchnick:
I think your statement is a bit too broad in looking at success stories. In the blockchain and digital assets space, the historical performance of consortia has actually been quite poor—this is already being generous. It’s not to say consortia are inherently unworkable, but we need to recognize that achieving genuinely economically valuable outcomes in this space is extremely difficult.
Pet Berisha:
What is your recommendation?
Robert Mitchnick:
Let someone else deal with this issue. I’m currently in the banking system.
Pet Berisha:
Noah, you were previously at Visa and must have spoken with many banks—why are they choosing to tokenize deposits?
Noah Levine:
That’s a great question. I think a common misconception is that banks are conservative and uninterested in innovation—but that’s not true. They recognize there’s significant opportunity to leverage this infrastructure and build more competitive products. The main issue is unclear regulation. As mentioned earlier, while there have been some policy developments, many key questions remain unresolved, such as how to handle compliance and AML. As a result, banks are proceeding with great caution.
Some have been more aggressive—for example, JPMorgan Chase developed JPM Coin early on and is now making new attempts; Citi and others are doing the same. There are also some consortium projects, which, although unlikely to succeed, still attract banks’ participation because they don’t want to miss out on opportunities.
Robert Mitchnick:
I think another important point is that it must be clearly understood what problem tokenized deposits actually solve, or what unique value they offer compared to stablecoins. This question has not been adequately addressed yet.
Rob Hadick:
From the bank’s perspective, they would say that tokenized deposits allow them to maintain control over their deposit base while continuing to operate as a fractional reserve bank. From the other side, such as asset management firms, they would want to continue managing money market funds. So this is a博弈 among different stakeholders.
Pet Berisha:
Noah, what do you think the probability of success would be for a consortium of mid-sized banks?
Noah Levine:
I think it’s difficult for any specific project to succeed. But from a product perspective, stablecoins and tokenized deposits are entirely different things serving different users. The current product-market fit for stablecoins is primarily in the crypto capital markets—such as fund transfers between exchanges, DeFi, and serving as a dollar store of value outside the U.S. Meanwhile, these banks primarily serve local customers; for example, M&T Bank won’t serve users in Argentina. Therefore, their use cases are more focused on the wholesale level—such as fund transfers, back-office settlement, and internal efficiency improvements. In these scenarios, such projects have the potential to succeed, but they won’t become consumer-facing products.
Pet Berisha:
Robert, I’d like to ask one final question: As the crypto industry increasingly discusses “privacy,” such as ZK technology, why has this issue only now gained real attention?
Rob Hadick:
People have actually been doing this all along; it’s just that the demand wasn’t as strong in the past, or the only demand mainly came from somewhat questionable use cases. For example, with stablecoin payments, if you’re paying salaries or making transfers, you certainly wouldn’t want everyone to see how much each person receives. But in reality, how do we solve this? We use “net settlement”—for instance, aggregating all transactions for a day and settling only one transaction on-chain, which inherently provides a degree of privacy.
But in capital market scenarios, such as weekend trading or collateral management, it’s completely different. You can no longer rely on netting settlement because risk needs to be processed in real time, making privacy issues even more critical. ZK technology can address part of the problem, but not all of it. If you’re doing this on a public blockchain, the technical challenges are actually very high.
Pet Berisha:
We now move to the audience Q&A session.
Audience:
While everyone is discussing USD-pegged stablecoins, is there demand for non-USD stablecoins?
Rob Hadick:
There is no immediate demand, but it will certainly arise in the future. If all capital markets go on-chain, there must be multi-currency stablecoins; otherwise, you face exchange rate risk. For example, a hedge fund in the UK, if its assets are denominated in pounds, would not want to bear dollar risk every time. In the long term, multi-currency stablecoins will inevitably emerge. At the same time, from a broader perspective, we may be entering an era of “currency cold war,” and whether so many different currencies will even be needed in the future is itself a question worth debating.
Audience:
Stablecoins have already proven useful in the financial system, but how long will it take to overcome ordinary consumers' bias against "crypto"?
Noah Levine:
Many users are already using stablecoins without realizing it. For example, some new banking products are built on stablecoins, but users only see a regular account. The key is to hide crypto beneath the product, rather than making users aware of it.
Robert Mitchnick:
Another point is that stablecoins have limited appeal in domestic U.S. payment scenarios but are highly valuable in cross-border contexts, where there is greater friction and difficulty in obtaining U.S. dollars.
Audience (Bloomberg):
What would the market structure look like if all assets were on-chain in 5–7 years? Who would benefit, and who would be harmed?
Robert Mitchnick:
This is a difficult question. But overall, the value chain will shorten and intermediaries will decrease. Currently, a stock trade involves many parties: investors, prime brokers, exchanges, clearinghouses, custodians, transfer agents, fund managers, and more. Many of these intermediary steps can be compressed and automated.
This is good for investors due to increased efficiency; it presents an opportunity for asset management firms to reach more users; and it offers an opportunity for crypto exchanges, which currently serve only a small portion of global assets and have significant room for expansion in the future.
Pet Berisha:
Alright, that’s all for today. Thank you to everyone here in person and tuning in online. Thank you to our guests.