Private Equity to Drive Next Tokenization Phase

Welcome to the US Crypto News Morning Briefing—your essential rundown of the most important developments in crypto for the day ahead.

Grab a coffee and settle in—because the next phase of crypto tokenization may not come from where you expect. While stablecoins have dominated the narrative, a quieter shift is underway as institutions eye more complex, illiquid assets like private equity and commodities as the real drivers of future on-chain growth.

Crypto News of the Day: Private Equity and Commodities to Lead Tokenization, Standard Chartered Says

Standard Chartered has identified private equity and illiquid commodities as key growth areas for the next wave of crypto tokenization.

The bank acknowledges that the market for tokenization of real-world assets (RWA) has been dominated so far by stablecoins, digital assets pegged to the USD or other fiat currencies.

Based on this, it urges the industry to move beyond stablecoins and address regulatory challenges that have limited adoption in non-stablecoin RWA markets so far.

“Growth in non-stablecoin RWA tokenization has lagged significantly. At $23 billion, this market is currently only around 10% the size of the stablecoin market,” said Geoff Kendrick, Head of Digital Asset Research at Standard Chartered.

While stablecoins have led the charge in bringing real-world assets on-chain, Kendrick believes that more complex and traditionally illiquid asset classes represent the next frontier.

The Standard Chartered executive cited private equity and commodities. He argued that tokenization in these areas could drive meaningful efficiency gains, provided the right conditions are in place.

“Non-stablecoin RWA tokenization has lagged stablecoin growth for a number of reasons – regulatory uncertainty and focus on wrong areas being amongst them. However, I think that as regulatory clarity emerges and if tokenizers focus on the right areas, where being on-chain adds value, then growth will come,” Kendrick added.

Drawing from recent advancements in tokenized private credit, Kendrick sees similar success unfolding in other less-liquid markets.

“Lessons from the success of tokenized private credit tell me that the next successes will come from private equity and otherwise illiquid commodities,” he said.

In line with the lessons learned so far, Kendrick expects private equity and liquid off-chain commodities to be the next growth areas for non-stablecoin tokenization.

Regulatory Clarity Remains Key to Unlocking Non-Stablecoin Tokenization

However, Kendrick stressed that regulatory reform is still a prerequisite for unlocking the full potential of non-stablecoin tokenization.

While some jurisdictions, such as Singapore, Switzerland, the EU, and Jersey, are making headway, he warned that the broader regulatory playing field is fragmented, particularly around Know Your Customer (KYC) compliance.

“To unlock growth potential, we believe tokenization efforts need to focus on on-chain assets that are cheaper and/or more liquid than their off-chain equivalents, with shorter settlement times, as borne out by early success in the private credit space, or that solve an on-chain need, as in the case of tokenized T-bills,” Kendrick said.

This aligns with a recent US Crypto News publication, which highlighted stablecoin issuers using T-bills (treasury bills) to buy Bitcoin for free.  

He added that some tokenization projects have failed to deliver value because they focused on assets already functioning efficiently off-chain.

“Some current tokenization efforts, for example, for already liquid off-chain products like gold and US equities, have struggled because the on-chain asset does not add value in these ways,” Kendrick explained.

As institutional interest in digital assets matures, Standard Chartered’s analysis offers a strategic lens through which traditional finance (TradFi) can assess long-term opportunities in tokenization, grounded in utility rather than hype.

With regulatory momentum and targeted innovation, non-stablecoins are making headway in RWA markets, which could be poised for a breakout phase in the next cycle.

Chart of the Day

This chart illustrates the significant growth of real-world assets (RWA) on-chain from January 2021 to January 2025. It also highlights contributions from private credit, commodities, stocks, and other asset categories.

Byte-Sized Alpha

Here’s a summary of more US crypto news to follow today:

Crypto Equities Pre-Market Overview