Asset Tokenization: A Revolutionary Financial Innovation, Says BlackRock CEO

According to Odaily, BlackRock CEO Larry Fink highlighted asset tokenization as the most disruptive financial innovation since ETFs in his annual letter released on Monday. Fink believes tokenization has the potential to transform the democratization of global finance. He emphasized that tokenization could revolutionize century-old settlement systems by enabling instant on-chain clearing for assets such as stocks, bonds, and real estate. This innovation is expected to unlock significant liquidity currently frozen due to settlement delays, allowing capital to flow seamlessly around the clock. Fink also pointed out that asset tokenization could build a more inclusive financial infrastructure, enabling ordinary investors to access high-barrier sectors previously reserved for institutions through asset fractionalization. Additionally, smart contracts could enhance governance participation. He stressed that the development of digital identity systems will be crucial for tokenization to become mainstream. Fink called for global collaboration to establish a compliant and efficient identity verification framework, drawing inspiration from examples like India's Aadhaar, to unleash the trillion-dollar market potential.