As one of the pre-eminent global Tier one banks, UBS has an enviable reputation for longevity, regulatory conformity and global reach.
Because of its global and systemic importance for financial services, it chooses its partners and innovators with the utmost care.
In the past 12 months, UBS announced a steady stream of partnerships – including major projects with Ant International, Chainlink and KuCoin, among others.
Unlike previous years, when tokenisation sat at the edge of global banking, 2025 signalled a change where capital market incumbents moved from observation and private trials to publicly disclosed partnerships and serious investment. As one of the global major players, UBS’s tokenisation conversation has evolved distinctly.
Rather than being driven by technological breakthroughs or intensifying market pressure, tokenisation has become relevant as it started to recognise constraints from legacy processes – common examples of which are slow settlement cycles, fragmentation and a reliance on manual processes.
In an exclusive interview with Capital Pioneer, Laurens Schepens, lead for UBS Tokenize within the bank’s Centre of Excellence for Digital Assets, discussed the inner workings of a bank that has been building its digital blocks since 2019. Questions of scale, governance, legal certainty and operational fit gradually moved tokenisation out of experimentation and into the realm of infrastructure.
From Schepens’ vantage point, it has become critical to understand how, and under what conditions, tokenisation can be integrated responsibly into a global bank.
In response, UBS has narrowed definitions, prioritised product frameworks (over proofs of concept) and focused on areas where value exists even before discussions around scale take over.
This perspective offers a rare view inside a truly global institution as tokenisation moves steadily towards business-as-usual for a growing number of global financial players.
Defining tokenisation first
Before the conceptualisation of “UBS Tokenize,” Schepens explained that the bank had been monitoring decentralised finance for some time.
Now built around four clear, core pillars: innovative product frameworks, regulatory assurance, institutional‑grade offerings, and a blockchain‑agnostic stance – the service began with a deliberately narrowed definition.
Schepens described tokenisation as “an undefined term, used in many different ways.”
“If you create a token on a blockchain without a clear product framework, you’re essentially still operating in the unbacked crypto realm,” he explained.
“In that situation, you don’t really know what you own, and there are no economic or legal rights attached. Only when the technology is paired with a well‑defined product framework does it become a genuine tokenisation use case.”
Therefore, UBS concluded that tokenisation’s success fundamentally depends on combining a clear product framework with the right underlying technology.
The case for engaging early
For UBS, the decision to engage with tokenisation rested on two pillars: long‑term structural shifts reshaping finance and near‑term commercial opportunity.
At the Centre of Excellence, Schepens described the bank’s thinking as two‑pronged, beginning with a macro view. At the systemic level, the appeal wasn’t tied to any single product or platform, but to a broader shift in how financial value could move.
“At a fundamental level, power comes from directly connecting information with value,” Schepens said.
He explained that within banking processes, information is constantly exchanged, but moving value is much harder.
“If you start connecting those two directly, there is the potential to reorganise the entire financial value chain. That is highly disruptive for banking, and that was certainly part of the thinking.”
For a global institution, engaging early was less about speed and more about readiness, and to pinpoint this value, UBS assessed tokenisation through a commercial lens.
“UBS Tokenize has always focused on commercial use cases,” Schepens said. “We started with structured notes because they offered immediate advantages.”
The bank focused on real, revenue‑generating applications that clients signalled demand for.
Structured notes were the obvious starting point, an area where tokenisation could deliver clear, immediate gains.
As the originator of those products, UBS could issue directly on a blockchain without relying on intermediaries.
“That gives us a lot of flexibility,” Schepens said. Internally, the approach was sometimes described as “high‑frequency issuance” — not in the trading sense, but in the ability to issue a wide range of assets continuously and adjust structures quickly.
That flexibility was only the first phase. “The second step is automation across the asset lifecycle, which is a journey we are still on,” he said.
“That’s where operational efficiency really starts to emerge, as you embed more logic directly into the asset.”
Schepens stressed that none of this was driven by investor demand for blockchain itself. “The investor doesn’t actually prioritise whether something is on the blockchain,” he said. “Investors care about risk–return profiles and about having a seamless experience.”
In that context, tokenisation becomes an enabler rather than an end goal. “As expectations around instant, frictionless experiences grow across all industries, those expectations are increasingly translating into financial services,” Schepens said. “Blockchain‑based issuance can help facilitate that.”
UBS’s early activity offered proof of concept. “We started with structured notes and have now reached around $700mn in issuance volume,” Schepens said. “That isn’t enormous, but it demonstrates that this is a real, functioning commercial product.”
For UBS, that combination of strategic foresight and operational evidence shaped its decision to engage. Tokenisation wasn’t treated as an experiment, but as a capability to be developed responsibly, tested commercially and integrated over time into the bank’s broader infrastructure.
The next question was no longer whether to pursue tokenisation, but what kind of infrastructure could carry it.
Navigating infrastructure choices
Having validated tokenisation commercially and begun treating it as a long‑term capability rather than an experiment, UBS then faced a more fundamental question: what kind of infrastructure should underpin it? The answer would shape not only individual products, but the bank’s ability to scale.
One of the more consequential choices UBS made as it developed its tokenisation capabilities was to remain blockchain‑agnostic. The decision was pragmatic rather than ideological, shaped by where product‑market fit began to emerge.
“UBS Tokenize has two core components: a product framework and a technology framework,” Schepens explained. “One key decision we made early on was to remain blockchain‑agnostic. We have issued on both private and public blockchains.”
In the early stages, both approaches were explored. Over time, however, the limitations of closed systems became more apparent, particularly as UBS began to think beyond individual products and towards scalable infrastructure.
For UBS, the appeal of public blockchains was not decentralisation for its own sake, but the presence of shared infrastructure and common standards.
“Public blockchains allow you to leverage existing infrastructure and standards, without the need for custom integrations,” Schepens said. “We are strong proponents of public standards in everything we build.”
UBS deliberately kept the issuance process simple. “At a basic level, the asset is issued as a smart contract,” Schepens explained. “A smart contract is a small software application that defines ownership and units.” Additional functionality was added only where necessary, reflecting the asset’s status as a regulated security.
Operating on a public network, however, introduced considerations that could not be ignored by a regulated institution. “Public chains have the advantage of being global infrastructure,” Schepens said, “but on the other side, everything is public, so you have to deal with privacy issues.”
Permissionless participation had also long been a point of concern for banks.
From UBS’s perspective, the response lay in governance rather than restriction. “As regulated financial institution we administer the smart contracts representing the assets,” Schepens said. “We brought banking-grade security and policies to this process.”
That distinction, he added, was critical. “A more fundamental risk is who is managing these smart contracts. Through UBS Tokenize, we owned that and control it, and an apply safekeeping and recovery standards on top of it.”
This approach allowed UBS to engage with global, open infrastructure while remaining within a framework regulators and clients could trust. “You can take advantage of the underlying technology,” Schepens said, “while managing the risk appropriately.”
Why APAC proved ready for tokenisation
Having established the technical foundations and governance model for tokenised issuance, UBS then had to determine where those capabilities could operate in practice. The answer depended less on geography than on which markets had the right conditions in place.
As UBS expanded its tokenisation activity, progress was not evenly distributed across markets. Certain regions moved faster, not because of greater enthusiasm for innovation, but because the conditions required for production were already in place.
“In my view, a commercial tokenisation use case requires three components to come together,” Schepens explained. “First, you need the technology. Second, you need a supportive legal and regulatory framework. Third, you need product–market fit.”
Those components did not emerge simultaneously everywhere. “That alignment happened early in Switzerland, Hong Kong and Singapore,” Schepens said. “Switzerland had the regulatory foundation. Hong Kong and Singapore have been very supportive from a regulatory perspective and also have thriving fintech ecosystems, which enables collaboration.”
For UBS, the key factor in those markets wasn’t enthusiasm, it was their operational maturity.
As a global institution with regulated operations across multiple markets, UBS was able to deploy its tokenisation capabilities where legal certainty, infrastructure and distribution could move together.
In Hong Kong, UBS worked with OSL, a licensed digital asset exchange. In Singapore, the bank launched a tokenised money market fund using the variable capital company structure, which enabled a tokenised share class within an established legal framework.
Distribution models in the region also allowed UBS to rethink parts of the value chain. “We work with locally licensed distributors, including one that describes itself as a licensed decentralised exchange because it is fully smart-contract-based and non-custodial,” Schepens said.
That structure changed how investors interacted with the product. “The distributor conducts KYC and has the licence to sell the asset, but the investor holds the asset themselves,” he explained. “That fundamentally rethinks the value chain in a way that isn’t possible with traditional funds.”
Regulatory coordination played a central role in enabling that shift. Initiatives such as Project Guardian, led by the Monetary Authority of Singapore, brought regulators and market participants into direct collaboration.
“The focus has shifted from experimentation to commercialisation, standard-setting and collaboration across the ecosystem,” Schepens said.
From UBS’s perspective, these markets offered more than early momentum. They demonstrated how tokenisation could function responsibly when regulation, technology and product design moved in alignment.
That experience, Schepens suggested, was less about geography than about replicability. The same conditions would ultimately be required wherever tokenisation was expected to operate at scale within a global bank.
From token creation to lifecycle transformation
The early APAC deployments showed that tokenisation could operate responsibly in real markets. The next challenge was determining whether it could go beyond asset issuance and take on a much broader role in reshaping and setting the agenda for how global banks should now be run.
By the time UBS had demonstrated it could issue assets on‑chain, a different limitation surfaced. Creating the tokenised asset was only the first step. The real opportunity, Schepens explained, sat further down the value chain.
“I see this developing in stages,” Schepens said. “First, the industry starts with the creation of the tokenised asset, and I feel the industry has largely figured that out. There are frameworks that work. You don’t need to do a trial anymore.”
What followed was more complex. “The next step is bringing more of the asset lifecycle onto the blockchain to take advantage of efficiency and composability,” he said. “To date, that has been minimal. So far it has mostly been about making the asset available.”
At UBS, issuance alone did not fundamentally change operating models. Efficiency only began to emerge when administrative processes, transfers and lifecycle events were reconsidered alongside the asset itself.
Schepens pointed to a recent live transaction as a practical example. Using Chainlink’s Digital Transfer Agent, UBS completed its first on‑chain redemption of a tokenised fund, marking a milestone in bringing fund administration closer to the ledger itself.
“That is futureproofing where we’re going,” Schepens said. “The more value that is transacted on‑chain, and the more other financial firms build capabilities, the more interesting it becomes. Then you get real efficiency advantages.”
The emphasis was not speed for its own sake, but the removal of accumulated friction. Fund administration, reconciliation and settlement could take days, particularly when trades failed and re‑entered the processing loop. Bringing those functions on‑chain offered a way to simplify workflows without sacrificing institutional control.
For Schepens, this stage marked the transition from product experimentation to operational change.
Issuance proved feasibility. Lifecycle integration was where tokenisation began to reshape financial infrastructure in practice.
Stablecoins and the missing settlement leg
Lifecycle integration highlighted a deeper structural issue: even as tokenised assets moved on‑chain, the cash leg of the transaction remained off‑chain. Without solving that, tokenisation could only go so far.
As UBS moved tokenised assets into live environments, another structural gap became difficult to ignore. Many early pilots had replicated only one side of a transaction. The asset was tokenised, but the cash leg was not.
“A missing piece in past transactions, especially pilots, has been that we had the tokenised asset leg but not the tokenised cash leg,” Schepens said. “Or not something prudent for a bank to use, something regulated.”
Stablecoins had existed for years, but their structure limited institutional use. “When you own one as an individual, you’re basically owning ‘hope,’” he said. “You hope someone gives you one dollar for it.”
That began to change as regulatory frameworks and guardrails emerged. “Stablecoins are being wrapped into legal frameworks with guardrails,” Schepens explained. “And we, as a bank, have announced that we are exploring, with other banks, the potential issuance and usage of stablecoins.”
Viewed through an infrastructure lens, the implications were significant. “From the asset side, that brings the next level of utility,” he said. “If you can connect programmable assets with a regulated digital money leg on the same network, it becomes very interesting.”
The convergence of tokenised assets and regulated digital cash addressed a long‑standing operational constraint. Settlement risk, reconciliation delays and fragmented liquidity had limited the efficiency gains tokenisation promised.
Bringing both legs of a transaction onto the same infrastructure offered a more coherent and controllable model.
In that context, stablecoins only became relevant once they could be used prudently, within frameworks regulators and institutions were comfortable with.
Now, UBS joins the ranks of major global banks from JPMorgan Chase to Standard Chartered, that are also moving into the post‑regulatory‑clarity stablecoin ecosystem.
Preparations over predictions
Solving the cash‑leg problem brought tokenisation closer to functioning as real financial infrastructure. But even with both sides of a transaction moving on‑chain, the bigger question became how quickly, and how far, the industry would evolve.
Looking ahead, Schepens avoided timelines or bold forecasts. The pace of change, he argued, was inherently unpredictable.
“Predictions are very hard to make,” Schepens said. “Something disruptive and exponential often goes slow until it goes fast, and suddenly all the pieces fall into place.”
“Progress will come as we move in step with our peers,” Schepens said. “Liquidity remains rooted in mainstream finance, and we are mainstream finance. Unlocking that potential is something we must do collectively.”
In Schepens’ view, the future of tokenisation won’t hinge on prediction, but on preparation: building the capabilities now so the industry is ready when the pieces finally fall into place.
For UBS, that preparation is no longer theoretical. It is already reshaping how the bank designs its products, evolves its infrastructure and adapts its operating model for a tokenised future.
This article was originally published issue 5 of Capital Pioneer magazine.
