Blockchain Capital partner Aleks Larsen says finance has long suffered from an expensive packaging problem.
In today’s system, each asset is recorded and administered differently, and those records sit inside disconnected systems. A mortgage may be represented through contracts, PDF files, databases, and servicing relationships. A private fund interest may amount to a subscription agreement and a single line on a transfer agent form. Ownership of a stock can be spread across records kept by brokers, custodians, and securities depositories.
When an asset moves from one institution to another, the original record often has to be broken apart, checked, reconciled, and then rebuilt under the receiving party’s rules. Many operational processes exist for one reason: different institutions are tracking the same underlying asset or claim in different ways.
Larsen writes that this fragmentation carries major hidden costs at a global level. Balance sheets around the world record nearly $1,800 trillion in assets, and a large share of that capital still cannot move freely across institutions unless a bespoke process is built for it. In his view, that friction slows how quickly capital can be redirected into new businesses, infrastructure, housing, and other productive uses.
He argues that tokenization addresses the problem at the root. A token gives an asset or financial claim a standardized, machine-readable interface. Once an asset can be identified and used on a shared network, trading venues, lenders, custodians, asset servicers, and software applications can interact with it directly, without rebuilding a separate layer of financial infrastructure each time.
That opens the door to capital markets running on a common, programmable base network where assets can move, settle, and be used more smoothly.
Why Larsen compares tokenization with containerization
Larsen says the best analogy for understanding tokenization is containerization.
Before the 1960s, goods moved in many different forms. Coffee was shipped in sacks, machinery in wooden crates, cotton in bales, and oil in barrels. Each product came with its own loading and unloading requirements, so every ship depended on manual labor.
Skilled dockworkers developed an entire craft around that work. They had to pack cargo tightly, balance weight, and secure goods so they would not shift or break at sea. The craft was essential because there was no common standard for freight packaging.
The result was slow and costly. Ships often spent more time in port than they did sailing. Break-bulk cargo had to be repeatedly handled and counted as it moved between ships, trains, trucks, and warehouses, and it was more likely to be damaged, lost, or stolen.
In 1956, North Carolina trucking entrepreneur Malcolm McLean converted an oil tanker into the Ideal-X, loaded it with 58 detachable truck containers, and sent it from Newark to Houston.
When the ship arrived, trucks could haul the containers away without opening them. The Ideal-X cut loading costs to $0.16 per ton, about 36 times cheaper than traditional break-bulk shipping. Larsen presents that moment as the birth of the modern shipping container.
Over the next 20 years, container dimensions, locking mechanisms, and load requirements gradually became standardized. The wider supply chain then reorganized itself around that standard box, and each link in the chain was able to specialize more deeply.
Ships adopted vertical cells so containers could be stacked safely. Cranes were redesigned for fast, standardized lifts. Truck chassis and railcars adopted common dimensions and fastening systems. Ports became large transfer hubs built to move containers efficiently between different transport modes.
The most immediate effect was a sharp drop in time and capital costs. Shipping time from Australia to Europe fell from 70 days to 34 days, while vessel capacity increased fourfold.
International trade shifted more toward finished goods and intermediate goods, and companies began splitting production across different countries. As supply chains expanded quickly, new logistics firms emerged to coordinate an increasingly complex global network.
Larsen cites World Bank estimates that bilateral trade between developed countries rose 1240% in the 15 years after both trading partners adopted containerization. In his account, containerization and the infrastructure rebuild around it allowed global supply chains to scale and materially accelerated world economic growth.
Tokens as the shipping container of finance
Larsen describes a token as a standardized container for financial rights.
It does not hold cargo. It holds ownership, transfer rules, cash flows, permission requirements, and other state information tied to an asset. Put differently, a token records who owns an asset, how it can move, what cash flows it generates, and what actions software can take on it.
Once an asset has a machine-readable interface, an exchange can offer trading, a lending market can accept it as collateral, a custodian can safekeep it, and a wallet can receive and route the cash flows it produces. Software can identify the asset and apply the right rules directly, without separate negotiations and integrations with every institution involved.
That, Larsen argues, is the difference between tokenization and simply digitizing documents or adding another database. All participants can identify and use the same asset through the same standard. Once the broader ecosystem adopts that standard, network effects start to compound.
Stablecoins as the clearest live example
Larsen says stablecoins show the potential of tokenization more clearly than anything else.
A traditional international wire transfer usually moves through correspondent banking rails and can take days to complete a dollar transfer. A stablecoin transfer can reach anywhere in the world in seconds, with near-zero pure onchain transfer cost.
He attributes that to an already-formed network of exchanges, custodians, fiat-to-stablecoin conversion providers, payment processors, and wallets, all of which can recognize the token interface of a stablecoin. In his analogy, they function like the ports, cranes, trucks, trains, and ships of finance, moving value in token form.
Much of that infrastructure was initially built for Bitcoin and Ethereum. Once it existed, though, stablecoins and other tokens could move across the same network. Stablecoin activity then attracted users, liquidity, applications, and more infrastructure, while later tokenized assets could plug directly into the same rails.
Larsen says the outcome is already visible. Circulating stablecoin supply is about $300 billion, transaction volume is nearing Visa’s scale, and money velocity is roughly 10 times that of traditional M1/M2 money.
Cross-border payment costs have dropped by an order of magnitude, and hundreds of millions of people now have access to a more reliable dollar and payment channel. At least in dollar use cases, Larsen says, the network has already proved itself superior to traditional systems on cost, speed, and reach. The same dollar can circulate more often inside the network, which raises capital efficiency.
That active pool of dollar liquidity is now attracting other assets onchain to absorb stablecoin capital. Larsen writes that tokenized onchain assets outside stablecoins are now close to $40 billion, around 10 times the level of two years ago, and still accelerating.
Those assets include U.S. Treasuries, money market funds, commodities, private credit, equities, and fund interests, with hundreds of issuers already involved.
The chart in the article, sourced to RWA.xyz, shows the total size of the onchain RWA market.
Tare and the move of loan workflows onchain
Larsen says the next natural step is to bring the business processes behind financial assets onchain as well.
He points to Tare, a Blockchain Capital portfolio company, which he says is moving loan origination, lifecycle management, and securitization onchain, while using tokens to record the full lifecycle data of each underlying loan.
With lightweight software and transparent markets, Larsen says, Tare can replace a traditional lending chain that is expensive and full of intermediaries. In that market, borrowers and lenders can record and verify tokenized loans on the same ledger.
He says that structure can lower borrowing costs and make loans easier to use as collateral across different onchain applications, drawing more assets and capital into the tokenized network.
According to Larsen, similar opportunities exist across every asset class. As infrastructure improves, network effects should keep attracting liquidity, users, and applications, and tokenized assets should grow faster as a result.
Capital markets reorganizing around tokens
Larsen argues that just as global supply chains reorganized around containers, global capital markets will reorganize around tokens.
He says early versions of that structure can already be seen in decentralized finance. He points to another Blockchain Capital portfolio company, Aave, which lets users post qualifying tokens as collateral and borrow from lending markets at floating rates. The rules are written into the protocol, while an asset’s eligibility as collateral is determined at the asset-standard level.
That is very different from the structure of traditional lending markets.
In the current financial system, an individual or business that wants to borrow against an asset usually has to start by finding an institution. That institution controls access, evaluates the borrower under its own process, and delivers the product through its own network. What services a customer can obtain depends largely on the relationship with that financial institution.
On Aave, Larsen says, the real gating factor is the asset itself. Smart contracts identify the token, apply transparent rules, and connect it to capital markets.
That changes the logic of market access. Financial services begin to organize around the asset, not around which institution a holder has a relationship with.
In Larsen’s framing, tokens make assets executable in the way software is executable. When an asset exists in a format a public network can recognize, different applications can offer trading, financing, payments, and treasury management around the same asset. Exchanges can list it, lending protocols can accept it as collateral, and wallets can receive and route the cash flows it generates.
An issuer only needs to put the asset onchain once to connect it to multiple applications, rather than building a separate system for each use case.
Larsen says this also changes how financial institutions are organized. Banks, brokerages, and asset managers now tend to bundle custody, underwriting, liquidity, asset management, compliance, and distribution inside closed product stacks.
Crypto networks allow those functions to be separated and specialized. One institution can originate and manage loans, while others can supply capital, assess risk, execute trades, provide insurance, or build applications that use the asset.
Assets can move across those specialist services through a shared interface, without being re-registered and re-integrated every time they enter a new provider’s system.
For that reason, Larsen says, scale advantages shift from a single institution to the network as a whole.
In traditional finance, large institutions can support more products because they can absorb the fixed cost of building infrastructure for different assets and customer segments. On public crypto networks, much of that infrastructure is shared by all participants.
New service providers do not need to rebuild ledgers, trading, custody, and settlement systems before they can tap into an existing network of assets, capital, and users. That lowers both system costs and barriers to entry.
Larsen says stablecoin network effects have already crossed a critical threshold and are becoming self-reinforcing. He expects capital markets to be reorganized more and more into open service networks built around tokenized assets.
In that model, institutions compete on who can provide better capital, underwriting, risk management, asset servicing, and distribution, rather than on who owns the database or controls the only gate into the market.
From isolated records to a global onchain balance sheet
Larsen says the most important result of this shift would be a capital market with global reach.
Today, capital markets are still constrained by financial institutions. Most individuals and businesses cannot access those markets directly and instead choose from a limited menu offered by institutions that are willing and able to serve them.
Institutions decide which clients to serve, which regions to cover, which asset classes to support, and what transaction sizes are worth handling.
Investors face the same limits in the opposite direction. They cannot access every asset globally; they can only invest in assets that institutions have already underwritten, packaged, integrated, and distributed.
Larsen says that leaves a large amount of economic value outside the reach of current capital markets.
Small receivables, local infrastructure, private businesses, emerging-market credit, and unconventional cash flows may all have real economic value. But they can still be too small, too fragmented, too poorly understood, or too far from major capital centers to justify the cost of financing them through traditional financial infrastructure.
Investment opportunities may exist, and capital may exist, but the network that connects the two does not.
In Larsen’s view, tokenization gives assets a standard interface so they can be discovered and used across a global financial network. As finance reorganizes around that interface, the cost of market access should fall sharply for all participants.
Financial functions can then be embedded directly into software, much like payments and data interfaces. Developers can build specialized services for narrow asset classes and specific regions, extending capital markets into areas they have struggled to reach.
Commercial applications that historically had trouble accessing complex financial services could also integrate payments, working-capital finance, collateral management, and treasury functions into their own systems, bringing idle or previously excluded assets into onchain capital markets.
Larsen also says tokenization will not magically make an unfinanceable asset financeable. Over a longer horizon, though, it can help many sound assets that are currently cut off from capital markets for structural reasons to participate.
AI as an amplifier for tokenized markets
Larsen adds that AI could amplify the shift by helping with complex parts of asset evaluation and operations.
He says AI agents could evaluate assets, price risk, allocate capital, manage collateral, and complete settlement in a global, efficient, machine-readable market, lowering the cost of delivering financial services.
With AI and crypto infrastructure working together, markets that are currently customized and intermittent could become continuous, global, and increasingly automated. Larsen says that could create more opportunity across regions and reduce the grip of institutional bottlenecks on capital.
He frames capital allocation as one of the core mechanisms that determine where social resources go. It shapes which companies can expand, which technologies can scale, which homes and factories get built, and which regions can develop.
In the current system, some assets may not be worth evaluating and financing because they are too small, too local, too unusual in structure, or too costly to manage. If the cost of finding, financing, and managing those assets falls sharply, they may re-enter capital markets.
Larsen closes by returning to the container analogy. Containers did not just cut transport costs; they made entirely new forms of trade and production economically viable. Goods could be produced where costs were lowest, assembled somewhere else, and sold globally because the cost of coordinating that network had fallen dramatically.
He argues tokens can do the same for capital.
Over the coming decades, global balance sheets may evolve from isolated records into a market software can directly identify and access. Capital, he says, would then move more on asset quality and return potential, and less on which institutions control market access.
If stablecoin adoption is any guide, Larsen says, this shift could materially expand global capital markets and push them into regions they have never truly covered before.