Financial services firms are accelerating investment in digital asset infrastructure and expanding retail access to crypto trading, even as a new category of high-leverage derivatives draws small investors into some of the market's most volatile corners.
Eighty-four percent of senior decision-makers across wealth management, asset management, capital markets and digital asset firms now view tokenization as strategically important to their organization, according to Broadridge Financial Solutions' inaugural Tokenization Pulse Survey, which polled 200 executives in the US and Canada.
Sixty-eight percent expect tokenization to partially reshape financial markets within three to five years, and 69% plan to blend digital capabilities into existing infrastructure rather than build separate systems. More than nine in ten expect tokenized and traditional assets to coexist indefinitely, and roughly a third plan to raise tokenization spending by at least a quarter over the next two years.
However, adoption is uneven across the industry with capital markets firms furthest along in implementation, while asset and wealth managers are still building out capabilities. Public market funds appear to be an early adoption point, with 80% of respondents expecting tokenized mutual funds and money market funds to matter within five years, compared with just half who see the same near-term significance for equities.
Retail-facing platforms are moving in step. E*TRADE from Morgan Stanley this month completed the rollout of spot crypto trading, letting eligible clients buy, sell and hold bitcoin, ethereum and solana through a linked account with digital asset infrastructure provider Zero Hash, at a 50 basis point fee.
“Our clients’ needs are evolving, and they want to invest, trade, bank, and plan for the future all in one place,” said Matt Jones, Head of E*TRADE from Morgan Stanley. “Whether they’re buying their first share, exploring crypto, participating in an IPO, or planning for retirement, our job is to meet them where they are – with the confidence and trust that comes from being part of Morgan Stanley.”
Retail traders are also piling into perpetual futures, derivatives that never expire and track an underlying asset's spot price through periodic payments between long and short positions, the Financial Times reported.
US regulators only cleared the products for domestic trading in May, when the Commodity Futures Trading Commission classified them as futures rather than swaps. Crypto perpetuals traded roughly 90 trillion dollars in volume last year globally, up from about 30 trillion dollars in 2023, according to Bank of America data cited by the FT.
The products carry outsized risk for retail traders because losing positions can be liquidated with little warning, without the grace period a traditional margin call provides, and winning positions can be forcibly deleveraged to keep exchanges solvent during a crisis.
Retail enthusiasm has not translated into broad public confidence in crypto though.
A new national survey of 1,000 registered voters conducted by Basswood Research for advocacy group Crypto Watchdog found 70% believe cryptocurrency mainly benefits insiders, criminals and scammers, against just 15% who think it gives ordinary investors a fair shot.
Only 20% of respondents said they trust cryptocurrency, while 65% reported a high level of distrust, and 72% want more regulation and oversight. Almost eight in ten said they have never owned crypto, and 68% said they would not consider owning it in future.
More than eight in ten agree cryptocurrency can easily be used in investment scams and consumer fraud and the same share agree cryptocurrency can have extreme volatility, causing investors to quickly lose their investment. Seven in ten believe it poses risks to the overall economy.
"Crypto has been sold to the public as a tool for financial freedom, but voters see something very different: a risky, opaque and insider-driven marketplace where ordinary people are left exposed," said Chapin Fay, executive director of Crypto Watchdog. "Americans do not believe the rules should be written for crypto billionaires, industry insiders or bad actors. They want transparency, accountability and stronger guardrails to be protected from fraud, manipulation and abuse."
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