What does tokenisation actually change?
When the ECB's Isabel Schnabel set out options for bringing central bank money on chain, the case rested on two properties rather than on the technology in general: programmability, which lets settlement depend on rules that execute automatically, and atomicity, which makes both legs of a transaction settle together or not at all. Everything else in the pitch follows from those two.
Her three architectures show how differently the same goal can be built: direct issuance of tokenised reserves on a platform run by the central bank; bridging, where reserves stay in the existing real-time gross settlement system and an interoperability layer links it to ledgers; and a private intermediary that tokenises reserves and issues fully backed settlement tokens, which are private claims rather than claims on the central bank. The Eurosystem's Pontes project, launched on 21 September 2026, takes the bridging route to TARGET2.
What decides the legal claim behind a token?
Not the ledger. Canada's Office of the Superintendent of Financial Institutions stated that tokenised deposits are not legally distinct from traditional deposits, adding that the technology of a product does not determine its legal nature. That sentence is what let Canada's six largest banks begin exploring a Canadian-dollar tokenised deposit system: a token that is legally a deposit sits inside existing capital, insurance and supervisory arrangements.
| Instrument | What the holder has a claim on | Where the rules come from |
|---|---|---|
| Tokenised deposit (Canadian banks) | A regulated bank, inside deposit insurance and supervision | A supervisor's statement that it is legally a deposit |
| Settlement token from a private intermediary (ECB option) | The intermediary, with tokens fully backed by central bank reserves | A private claim, not one on the central bank |
| Tokenised catastrophe bond (Bermuda plan) | Legal ownership of the bond itself | Securities, insurance and investor-protection rules |
| Tokenised treasury fund in an exchange Earn tab | Units of a US government money market fund | Fund rules; Hong Kong professional investors only |
| Stablecoin held at a bank custodian | The issuer; the bank holds the token | Custody terms, with collateral use still subject to approvals |
The catastrophe bond plan from Harneys and dropRWA makes the same point from the issuer's side: each token is meant to represent legal ownership of the bond itself, not a claim on a wrapper. Whether a token is the asset or a receipt for it is the first question to settle, and the answer is in the legal documents, not on chain.
Does tokenisation fix servicing?
No, and private credit is where that shows first. Representing a loan on chain is a solved problem; servicing it — collections, restructuring, enforcement in a jurisdiction — stays off chain and depends on the same intermediaries as before. The tokenised instruments trading at the widest spreads to their conventional equivalents are the ones whose servicing is hardest to assess.
Does it widen access?
It can make smaller units possible; it does not remove the rules. Many catastrophe-bond offerings carry minimum investments of $250,000 or more, and the Bermuda plan's smaller beneficial interests would still have to meet securities, insurance and investor-protection rules. Franklin Templeton's tokenised government liquidity fund reached an exchange's Earn tab in Hong Kong, and access there is limited to professional investors, with retail excluded.
Who can stop a tokenised asset?
Whoever can stop its chain or hold its token. MANTRA, a layer-1 built for tokenised real-world assets, halted block production on 21 August while it investigated an incident, freezing all endpoints and transactions. For assets with an off-chain claim behind them, stopping a ledger that is in doubt may be the right trade — but a network that can be halted has someone who can halt it.
Custody arrangements are moving the other way, towards separating who holds an asset from where it trades. Standard Chartered's Dubai branch now holds RLUSD for institutions and plans, subject to approvals, to let clients use it as collateral on LMAX without moving it to the venue.
How large is the tokenised market, really?
Tokenised real-world assets stood at $38.2 billion on 23 August, close to double the $20.6 billion of a year earlier, and US treasury debt accounted for $15.6 billion of that. The honest description of the sector is government paper with a settlement layer attached, growing from the least exotic asset available.
Questions
- Is a tokenised deposit the same as a stablecoin?
- No. A tokenised deposit is a claim on a regulated bank, inside deposit insurance and supervision, that happens to be recorded on a ledger; Canada's supervisor stated such deposits are not legally distinct from ordinary ones. A stablecoin is a claim on its issuer.
- Does tokenising an asset make it available to retail investors?
- Not by itself. Smaller units become technically possible, but securities and investor-protection rules still apply. A tokenised treasury fund distributed through an exchange in Hong Kong, for example, is limited to professional investors.
- What do central banks want from tokenisation?
- Programmability and atomicity: settlement that can depend on rules executing automatically, and transactions whose legs settle together or not at all. The ECB's Pontes project, launched on 21 September 2026, links TARGET2 to a Eurosystem ledger for that purpose.