JPMorgan's Scott Lucas argues that tokenization's most profound impact is not just making existing processes faster or cheaper. It's about fundamentally redesigning financial instruments—like paying bond coupons by the millisecond—which could open up debt capital markets to smaller companies that cannot access them today.
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The combination of AI, smart contracts, and stablecoins could create a "cauldron for credit market innovation." Circle's CEO imagines a future where credit decisions are cleared and settled with the efficiency and speed of a Google AdWords auction, dramatically increasing monetary velocity and access to capital.
The key to tokenization is combining two worlds: traditional finance's expertise in legally custodying assets, and crypto's native, free infrastructure for 24/7 trading and liquidity. This fusion makes it possible to make previously untradable assets like private equity, art, or collectibles instantly liquid and accessible.
AI and crypto are not competing but are parallel, complementary forces reshaping business. While AI revolutionizes company creation and internal operations, Internet Capital Markets (powered by crypto) are fundamentally rewriting the external functions of capital formation, trading, settlement, and ownership for this new generation of AI-native companies.
Scott Lucas of JPMorgan counters the "everything on-chain in 10 years" narrative. He argues the main hurdles aren't technological, but rather the slow, complex process of achieving legal clarity, regulatory understanding, and upgrading massive internal legacy systems across the financial industry. This institutional drag makes a rapid overhaul highly improbable.
JPMorgan's Scott Lucas identifies a critical bottleneck for tokenization: the lack of scalable, usable on-chain cash equivalents. He states that the success of tokenized assets is fundamentally dependent on having deep liquidity in settlement mechanisms like stablecoins, tokenized deposits, or CBDCs, which are not yet mature enough for broad market adoption.
Polymarket's major backing from the NYSE's parent company validates the trend of turning all information and events into liquid, tokenized markets. This "financialization of everything" will disrupt established industries, from sports betting to traditional finance, by offering more efficient, decentralized alternatives.
While stablecoins face regulatory uncertainty, major banks like J.P. Morgan and Boney are developing a competing product: tokenized deposits. These offer the same blockchain efficiencies for fund transfers but operate within the existing, trusted banking regulatory framework, presenting a more attractive, lower-risk alternative for institutional clients.
The key benefit of tokenizing private credit or real estate is not just efficiency, but fractionalizing large, illiquid assets into smaller, tradable units. This unlocks global capital from family offices and other investors who cannot afford the traditional high minimum investment tickets.
Beyond simple consumer payments, the most significant impact of Japan's stablecoins will be on its financial market infrastructure. By enabling real-time settlement for securities like stocks and bonds—a process that currently takes days—stablecoins can dramatically increase efficiency and reduce counterparty risk.
Multicoin's central thesis is that crypto's ultimate purpose is creating "Internet Capital Markets"—the ability to trade any asset, from anywhere, 24/7, via any software. This broad vision of permissionless, programmable finance is seen as the most significant long-term impact of blockchain, destined to supersede more niche consumer applications or "Web3" concepts.
