Larry Fink, the chairman and chief executive of BlackRock, the world’s largest asset manager with nearly $14 trillion in assets under management, has become the most influential institutional voice arguing that the future of finance will be tokenised.
What once sounded like Silicon Valley evangelism is now being articulated from the very centre of global capital markets. Fink’s claim is simple but sweeping: the conversion of real-world assets into digital tokens on distributed ledgers will mark the next structural leap in finance, comparable to the shift from paper certificates to electronic settlement or from dial-up internet to broadband. Crucially, this is no longer a theoretical proposition. BlackRock itself has begun deploying capital and credibility behind the idea.
The most concrete example is BlackRock’s tokenised money-market product, known as the BUIDL fund, which invests in short-term US Treasury instruments and cash equivalents while issuing ownership in digital token form on public blockchains.
Since its launch in 2024, the fund has grown rapidly and now holds assets running into several billion dollars, making it the largest tokenised Treasury product globally. It distributes yield to investors via blockchain rails and allows near-instant settlement, even as the underlying assets remain among the safest and most conventional in global finance. For Fink, this hybrid structure illustrates his broader point: tokenisation is not about replacing traditional finance but upgrading its plumbing.
Tokenised assets today still only represent a tiny sliver of global financial markets, and participation remains overwhelmingly institutional
In his recent communications to investors, Fink has described tokenisation as the “next generation of markets”. In practical terms, this means representing equities, bonds, funds, real estate or even infrastructure assets as programmable digital units that can be transferred peer-to-peer, settled instantly, and traded continuously rather than during narrow market hours.
Smart contracts embedded in these tokens can automate compliance, coupon payments, dividend distributions and corporate actions. The promise is radical efficiency. Settlement cycles measured in days could shrink to minutes, counterparty risk could be reduced, and vast sums currently immobilised in clearing and margin processes could be released back into productive use.
The economic logic is compelling. Today’s financial system still relies on multiple layers of intermediaries, reconciliations and batch processing. Tokenisation, at least in theory, collapses these layers into a single shared ledger.
For institutional investors, this could mean lower costs and better risk management. For issuers, it could mean faster access to capital and broader investor reach. For policymakers, it offers unprecedented transparency, with every transaction recorded and auditable. It is this efficiency dividend that underpins projections by consultants and banks that tokenised real-world assets could eventually run into trillions of dollars globally.
Fink also frames tokenisation as a democratising force. By enabling fractional ownership, assets previously accessible only to large institutions or wealthy individuals could, in principle, be opened to smaller investors. A commercial building, a private credit fund or a long-dated bond could be divided into thousands of digital units, each tradable independently. This idea of “democratising yield” has obvious political and social appeal, particularly at a time when inequality and financial exclusion dominate policy debates.
Yet, between promise and practice lies a considerable gap. Tokenised assets today still only represent a tiny sliver of global financial markets, and participation remains overwhelmingly institutional. Regulatory uncertainty is a major constraint. Most jurisdictions have yet to fully define the legal status of tokenised securities, the enforceability of smart contracts, or the treatment of digital wallets under insolvency law. Without clarity, large-scale adoption will remain cautious and incremental rather than revolutionary.
There are also deeper structural concerns. While blockchain technology is often associated with decentralisation, the version of tokenisation being advanced by major asset managers risks reinforcing concentration rather than dispersing power. If liquidity pools, custody systems and compliance layers are effectively controlled by a handful of global institutions, the benefits may accrue primarily to incumbents rather than to retail investors or smaller market participants. Cutting out traditional intermediaries does not automatically make markets fairer if new gatekeepers emerge in their place.
Cybersecurity and digital identity pose another challenge. Tokenised assets are only as secure as the systems that safeguard private keys and verify ownership. High-profile hacks in the digital asset space have already demonstrated how quickly confidence can evaporate when security fails. Fink himself has acknowledged that a credible, global framework for digital identity is essential if tokenised markets are to scale safely. Without it, risks of fraud, money laundering and market abuse will remain uncomfortably high.
For Pakistani readers, this debate is not an abstract one confined to Wall Street. Pakistan’s financial markets suffer from chronic shallowness, limited product diversity and high transaction costs. In theory, tokenisation could allow Pakistani issuers to tap global pools of capital more efficiently, while offering domestic investors access to a wider range of assets. But this would require proactive regulatory engagement, investment in digital infrastructure and a willingness to rethink legacy systems. Absent that, Pakistan risks watching another global financial transformation unfold from the sidelines.
There is also a cautionary lesson. Technology alone does not guarantee inclusion or stability. Without strong governance, tokenisation could amplify volatility, facilitate capital flight, or create new forms of systemic risk that regulators struggle to understand. The history of financial innovation is littered with tools that promised efficiency but delivered fragility when misused.
Larry Fink’s advocacy matters because BlackRock’s scale gives his words weight. When the steward of nearly $14tr signals that tokenisation is not a passing fad but a strategic priority, regulators, central banks and market participants are forced to pay attention. Whether tokenisation ultimately reshapes global finance or settles into a narrower role as back-office infrastructure remains uncertain. What is clear is that the conversation has moved decisively from the margins to the mainstream. For countries like Pakistan, the question is no longer whether this future will arrive, but whether they will be prepared when it does.
The writer is the former head of Citigroup’s emerging markets investments and author of ‘The Gathering Storm’
Published in Dawn, The Business and Finance Weekly, January 26th, 2026
