Binance founder Changpeng Zhao, widely known as CZ, has called for a broader push toward tokenization, arguing that virtually everything could eventually be represented as a blockchain-based asset.

His comments underscore his support for tokenization across different blockchain networks, while acknowledging one of the biggest challenges facing the sector: fragmented liquidity. The remarks were highlighted by the crypto-focused account @coinbureau on X, adding to a growing discussion about how tokenization could reshape financial markets and the broader digital economy.

Rather than advocating for one blockchain to dominate the sector, CZ appears to support a multi-chain approach in which different networks and issuers develop their own tokenized assets. In his view, having multiple participants competing and building at the same time could accelerate the overall growth of tokenization.

A Call to Tokenize Everything

Tokenization refers to the process of representing real-world or digital assets on a blockchain. These assets can include financial instruments, real estate, commodities, securities, intellectual property and other forms of value. Instead of relying entirely on traditional databases and financial infrastructure, tokenized assets can potentially use blockchain technology to record ownership and facilitate transfers. The most established example so far is already operating at scale: stablecoins such as USDT and USDC are effectively tokenized dollars, with a combined market value in the hundreds of billions, while tokenized gold products such as PAXG and XAUT trade on public blockchains.

CZ’s “tokenize everything” message reflects a growing belief that blockchain technology could eventually become part of the infrastructure supporting a much wider range of economic activity. The concept has already attracted interest from banks, asset managers, technology companies and governments. Tokenization, however, remains at an early stage compared with traditional financial markets, and one of the biggest questions is how separate tokenized markets will interact with each other.

Fragmented Liquidity Remains a Major Challenge

CZ acknowledged that a multi-chain tokenization environment could create a fragmented liquidity problem. If assets are issued across dozens or hundreds of blockchain networks, liquidity could become distributed across different ecosystems, making markets more complicated for investors and users. An asset issued on one blockchain might have limited liquidity compared with an identical or similar asset issued somewhere else.

Different networks may also use different standards, wallets and settlement systems, which could make it harder for users to move assets efficiently between ecosystems. Despite that challenge, CZ argues that having multiple participants building tokenization infrastructure could ultimately be the fastest way to expand the sector.

Why Multiple Blockchains Could Accelerate Tokenization

The blockchain industry has historically developed through competition between different networks. Bitcoin established decentralized digital money, while Ethereum and other networks expanded the use of smart contracts and decentralized applications. Today, numerous blockchains compete to provide faster transactions, lower fees, greater scalability and specialized functionality.

CZ’s position suggests that tokenization could follow a similar path. Rather than waiting for a single network to become the universal standard, multiple companies and blockchain ecosystems can experiment simultaneously — some projects may succeed while others may disappear. That competition could eventually produce better technology and more efficient infrastructure, and it could also encourage innovation in areas such as asset issuance, custody, settlement and decentralized finance.

Interchangeability as a Potential Solution

CZ also pointed to greater interchangeability between different issuers as a potential answer to fragmented liquidity. Interchangeability means that assets or tokenized instruments from different platforms could potentially interact more easily. If blockchain networks become better connected, users may not need to remain locked into one ecosystem: assets could move between compatible networks, or be represented across multiple platforms, while maintaining clear ownership records. This could help create deeper and more connected liquidity markets.

Interoperability has therefore become one of the most important areas of development across the blockchain industry. Developers are working on technologies designed to allow different networks to communicate and transfer information or assets, including cross-chain messaging protocols such as Chainlink CCIP and the Inter-Blockchain Communication protocol used in the Cosmos ecosystem, as well as token standards like ERC-3643, which is designed for permissioned real-world assets on Ethereum. For tokenization to reach a global scale, these systems could become increasingly important.

Potential Impact on Financial Markets

The implications of tokenization extend well beyond cryptocurrency trading. Traditional financial markets rely on intermediaries, databases and settlement systems that can make transactions expensive or slow. Tokenization could potentially simplify some of these processes by placing ownership and transaction records on blockchain networks.

Tokenized securities, for example, could potentially be traded with faster settlement. Real estate could potentially be divided into digital ownership units, and commodities could potentially be represented through blockchain-based tokens. Even private assets that are difficult to trade today could potentially become more accessible through tokenization. Regulatory frameworks, however, will play a major role in determining how quickly these markets develop, and some regulators have already begun testing them: the European Union operates a dedicated DLT Pilot Regime for blockchain-based market infrastructure, while the Monetary Authority of Singapore runs Project Guardian, a collaborative pilot with banks and asset managers exploring tokenized funds and markets.

Institutional Interest Is Growing

Major financial institutions have increasingly explored tokenized assets in recent years. Banks and asset managers have experimented with blockchain-based versions of traditional financial products, including funds, bonds and other instruments. The examples are concrete: BlackRock launched BUIDL, a tokenized US-dollar liquidity fund, on Ethereum in 2024; Franklin Templeton runs an on-chain US government money fund; and JPMorgan’s blockchain platform, rebranded as Kinexys, has processed more than a trillion dollars in cumulative payment volume. Boston Consulting Group has projected that tokenized real-world assets could reach roughly $16 trillion by 2030, illustrating the scale institutions are evaluating. This suggests that tokenization is moving beyond the crypto industry’s original focus and is increasingly being considered a potential upgrade to existing financial infrastructure.

The transition is unlikely to happen overnight. Financial institutions must address compliance, custody, investor protection and regulatory requirements before tokenized assets can reach mainstream markets. Still, the direction of development is becoming increasingly clear.

What Tokenization Means for Crypto

For the cryptocurrency industry, widespread tokenization could significantly expand the use of blockchain technology. Crypto networks would no longer be used primarily for native digital currencies; they could also become infrastructure for traditional assets and financial products. That could potentially increase blockchain transaction activity and create new demand for network services.

It could also bring more users into the crypto ecosystem. Someone who has never purchased Bitcoin or interacted with decentralized finance could eventually use blockchain technology through a tokenized investment product without even thinking of themselves as a crypto user. This could represent a major shift in how blockchain technology is adopted.

A Liquidity Problem That Cannot Be Ignored

Despite the optimism surrounding tokenization, fragmented liquidity remains a genuine challenge. If every issuer creates assets on a different blockchain, investors could face a complicated market environment. Users may need multiple wallets, accounts and applications to access different tokenized markets, creating friction that could prevent tokenization from reaching its full potential.

Interoperability could therefore become just as important as tokenization itself. A successful tokenized economy may require standards that allow different assets and networks to communicate efficiently. Without those standards, the industry could become divided into isolated liquidity pools.

A Multi-Chain Future

CZ’s comments suggest that he does not view fragmentation as a reason to stop tokenization. Instead, he appears to see competition as part of the process. Multiple issuers and blockchain networks can continue developing independently while the industry works toward greater interoperability. Over time, the strongest standards and technologies could become more widely adopted, producing an ecosystem where tokenized assets exist across different blockchains but remain increasingly accessible to users regardless of which network they prefer — a more mature version of the multi-chain economy.

Tokenization as One of Blockchain’s Biggest Use Cases

CZ’s call to “tokenize everything” reflects a broader shift in the cryptocurrency industry. The next major stage of blockchain adoption may not be driven solely by new cryptocurrencies; instead, it could come from bringing traditional assets and economic activity onto blockchain networks.

The biggest challenge will be connecting these separate tokenized markets. Fragmented liquidity, regulatory uncertainty and incompatible technologies remain significant obstacles — which makes the evolution of interoperability standards, the expansion of regulatory pilot regimes and the growth of tokenized funds the key developments to watch. But if interoperability improves, the advantages of multiple competing blockchain networks could outweigh those challenges.

Source: Hokanews