Hearing today (March 25) of the House Financial Services Committee “Coding and the future of securities” It reflects how far the conversation around digital assets, securities law, and institutional custody frameworks has come in a remarkably short time. The committee’s memorandum indicates this Lawmakers are considering regulatory gaps, investor protection, market integrity, and capital formation, a scope that would have been difficult to envision in a congressional setting just a few years ago. The Securities Industry and Financial Markets Association (SIFMA) places token assets in the real world More than $26 billion globallyincluding more than $11 billion in token Treasury debt. These numbers are increasing rapidly, and Washington is paying attention.
But scale and institutional momentum do not automatically translate into value for the people this technology is supposed to serve. The more important question is whether tokenization offers something better for ordinary investors, or whether it remains a back-office upgrade dressed in the language of democratization.
The infrastructure issue is not enough
The state of the industry for coding is now familiar. The Depository and Clearing Corporation (DTCC) refers to its simplification Post-trade infrastructure and asset mobility. Nasdaq offers the token as Part of a broader push Towards continuous market operations and more automated securities workflows. BlackRock’s BUIDL fund, Franklin Templeton’s chain-linked money market fund, and a growing list of institutional entrants have proven that pipelines can be built and that significant capital will flow through them. These are real improvements, but they are often invisible to end users.
Settlement that takes place in minutes, not days, is real operational progress. Programmable compliance and automated corporate actions reduce friction for institutions managing large investment portfolios. Interoperability between platforms, if achieved, could unleash liquidity in asset classes that have historically been difficult to trade. The infrastructure argument is not wrong. It is simply inadequate as a proposition to the consumer.
The question that concerns retail investors is more direct. Does tokenization make investing easier to understand, easier to access, and meaningfully better than the products they can already use today? If the answer is no — if tokenized securities seem like a slower, more confusing version of buying ETFs through a brokerage app — the technology will struggle to find a mainstream audience no matter what it does with settlement timelines.
I have argued before That the first 60 seconds still decide whether a user stays or leaves a financial product. The same rule applies here with particular force. A faster settlement won’t save a product that starts out with a confusing onboarding process, dense disclosures, or care arrangements that feel distant and fragile. Infrastructure can be neat, but if expertise isn’t, it doesn’t matter.
Access must be visible to the user
If token investing ends up looking a lot like purchasing securities through a standard retail app, the novelty will still be buried in the plumbing, and the market will reflect that. Retail users already have access to stocks, ETFs, and fractional shares through interfaces that have been refined over years of competitive pressure, so the token should expand access in a way that users can actually feel. Robinhood, Fidelity, Schwab and others have already lowered the barrier to entry for mainstream stock investing to a significant degree. Coding should expand reach in a way that users actually feel, not just in a way that analysts can draw.
The real opportunity lies in asset classes and markets that these platforms have not reached. Private credit, real estate, infrastructure debt and pre-IPO equity are categories in which retail participation has historically been limited due to minimum investment, credit requirements and illiquidity. The strongest consumer case for tokenization is opening doors to assets that were otherwise difficult to access, and then packaging that access into products that ordinary people can navigate without a financial glossary or a lawyer.
This requires both the underlying technology, clear regulatory paths, intuitive interfaces, and the kind of trust that only comes from a proven track record and knowledge. You made a similar point about Adopt the following Familiar behaviour, payment methods and flows that are recognizable in other contexts. Token investing will face the same test, and will fail if the product looks like a niche tool designed for insiders who actually understand what they are buying.
Ownership must travel, trust must endure
Transferability of ownership is another key test. If tokenized assets cannot move between users across regulated and permissioned environments – with clear custody, transfer protocols and legal enforceability – their promise will remain theoretical. Property that cannot be exercised or transferred is not usefully different from property that does not exist. Even the DTCC frames the fundamental opportunity in terms of interoperability, asset mobility and liquidity. Vision only works if the tubes are connected.
That’s why the law and custody are more important than fancy technology. The most advanced on-chain infrastructure in the world is not worth much to the average investor who cannot answer the question: If something goes wrong, what do I actually own and who is responsible for it? This question has not always been easy to answer in the tokenized asset space, and until it is, institutional adoption will outpace retail adoption by a large margin.
Nasdaq’s certification calls for clear legal definitions and jurisdictional limits. I tend to do that Same argument. Markets grow when the rules are clear enough for both institutions and ordinary users to trust what they are buying. Ambiguity benefits experienced participants who can afford to navigate it. It hurts everyone.
The regulatory underpinnings being discussed at today’s hearing — custody standards, transfer agent definitions, and broker-dealers’ treatment of digital assets — are the foundation upon which retail participation is or is not built.
Congress should evaluate the coding process by more stringent standards than speed of settlement or institutional efficiency. Both are important, but neither is sufficient. If tokenization provides broader access to asset classes that were previously out of reach, ownership that carries real legal heft, flexibility, and a user experience that feels truly better than what already exists, this market will grow rapidly and the public interest case will be clear. If it provides faster healthcare for institutions while leaving individual investors with a slightly more complex version of what they already have, tokenization may be one of the most significant missed opportunities in the recent history of fintech, leaving the public wondering what has changed at all.
