For this week’s Pioneering Conversation, gain insights from BNY’s Ben Slavin from an interview originally published in issue six of Capital Pioneer magazine.
Innovation is rooted in experimentation, and for many established financial institutions the journey to offering a fully end-to-end digital solution for investors is not an easy one. With the technology still so new to the market, the road less travelled is the only one available, as new discoveries continue to be made.
Founded in 1784 by Alexander Hamilton, the first Secretary of the Treasury in the US, BNY has spent more than 240 years working with its clients to advance the future of finance, offering its expertise and platforms to establish itself as a major innovative force both in the US and abroad. In 1996, the bank was the first to process securities over the internet, in one of many technical milestones.
As tokenised financial assets move squarely from pilot to at-scale development, BNY’s managing director, global head of ETFs, Ben Slavin, discussed the recent steps the bank has taken on its tokenisation journey.
“Journey is the perfect way to describe it, and any firm that’s working to integrate tokenisation into its product offerings would characterise that process as a journey they are on,” he said. “At BNY, we’re trying to stay ahead and evolve with the market.”
Expanding into digital assets
Today, BNY helps over 90% of Fortune 100 companies and nearly all the top 100 banks globally access the money they need. As of 30 September 2025, it oversees $57.8 trillion in assets under custody and/or administration and $2.1 trillion in assets under management.
Although tokenisation is a major innovation, it does not necessarily require asset managers to reinvent their models. The continued integration of blockchain technologies into the mainstream has, for many firms, begun by applying traditional fund servicing to digital assets funds.
For traditional ETFs, BNY offer services ranging from order taking to connecting with the liquidity providers, as well as accounting value, fund administration and financial statements.
“Effectively it’s all the infrastructure that is needed to power up ETFs, and we also act as the custodian for the assets,” Slavin said. “When you think about stocks and bonds for digital assets, things are changing. Our ability to be able to provide true custody for Bitcoin ETFs, for example, has changed since we started out, and we’re able to now provide those services to ETF issuers, which is a good step forward.”
The current state of the market
2026 is already shaping up to be a significant year for tokenised assets becoming a mainstream financial vehicle. A study from McKinsey & Co. found that tokenised market capitalisation could reach around $2 trillion by 2030, and that number is showing no signs of shrinking as a rising number of traditional financial players explore ways to make their mark in the industry.
“It’s evolving rapidly given the high demand and technology available in the market,” Slavin said. “The regulatory framework, which is incredibly important, underpins everything and is what is helping to push things forward. At the moment it is very fragmented, what is happening in France is different to the UK, US and so on.”
At BNY, the focus is on helping clients to be able to tokenise different assets, although Slavin noted that there are currently only a limited number of investment vehicles that have successfully been tokenised and as a result, access is very limited.
“If we’re thinking about tokenising an existing pool of securities, we are still in the early days. For most companies, they are effectively offering a tokenised share class,” he said. “In terms of accessibility, tokenised public securities, stocks or bonds, are natively on-chain but the majority are only available on private blockchains so it’s not available to a wider audience in the way that purchasing something like bitcoin is. “
In tokenising private assets or other real assets that are challenging to wrap into a traditional fund structure, there has been a broader application. There, tokenisation potentially lowers the barrier of entry for investors and could even offer an avenue for them to embrace other traditional vehicles.
The first steps
In the early days of applying tokenisation to existing traditional financial products, one of the most significant theoretical applications of the technology was around bringing liquidity to typically illiquid assets, such as real estate and private equity.
However, as more firms launched tokenised products in recent years, the vehicle of choice is often an already liquid product, such as a money market fund, which offers a more seamless foundation for applying tokenisation.
Offering assets on-chain provides investors with significant benefits, such as real-time data and settlement capabilities without cutoff times, offering 24/7 availability. However, a one size fits all approach to every asset class will not yield optimal results as these benefits aren’t necessarily applicable across all investment vehicles.
“Tokenisation opens up so many different possibilities, and at the moment money market funds, gilts and treasuries are among the asset classes that lend themselves to it,” Slavin said. “Liquidity is very important, and tokenisation in itself doesn’t change the underlying characteristics of an asset. Factors such as liquidity and valuation will continue to be driven by underlying assets. If it doesn’t trade, it doesn’t trade.”
Slavin expects to see further applications of tokenisation in the private equity space, particularly in cases of companies that have a large demand or interest in a secondary market.
The obstacles we’re facing
The rapid development of the tokenisation market has left regulators scrambling to keep up.
“This is a little bit of an inversion to what we typically see in the industry, as usually we’re waiting for the technology to catch up but in the case of digital assets, the technology has been the first piece of the puzzle,” Slavin said. “Internally, we’re working hard to invest in our own technology and taking the steps we need to in order to service our clients today.”
Digital asset regulation currently varies widely across different regions. For example, the legal status of cryptocurrencies varies significantly by country. According to an analysis by the Atlantic Council, cryptocurrencies are legal in 33 countries, partially banned in 17 and generally prohibited in 10.
“Ultimately, the current situation is that we’re waiting on both a regulatory framework and for the financial market infrastructure to be properly established.”
Recent milestones
Earlier this year BNY extended its digital cash capabilities for its institutional clients, marking another step forward in the bank’s ambition to tokenise bank deposits for real-time, on-chain settlement between industry participants.
It enabled the on‑chain mirrored representation of client deposit balances on its digital assets platform, helping to advance BNY’s ambitions to support programmable, on‑chain cash for institutional market infrastructure.
Early participants include a wide range of prominent financial institutions and digital natives.
Beginning with collateral and margin workflow use cases, this launch extends BNY’s cash capabilities by creating on-chain digital book entries that represent participating clients’ existing demand deposit claims against the bank.
This capability operates on BNY’s private, permissioned blockchain and is governed by the company’s established risk, compliance and control frameworks. Client balances continue to be recorded on BNY’s traditional systems to maintain regulatory and reporting integrity.
What’s next for BNY?
With global capital markets are currently at an inflection point, moving towards an always-on operating model while distributed ledger technologies (DLT), including blockchain, is becoming mainstream.
The current marketplace shift isn’t about blockchain technology immediately replacing traditional systems – it’s about the two coexisting to unlock new possibilities and different solutions for different client needs.
For custodians such as BNY, the fundamentals of the business, namely, trust, security and regulatory compliance, are the same, whether the custodian is holding digital assets, or more traditional assets.
The differences between the legal, regulatory and operational frameworks for digital and traditional assets mean that custodians have to manage these differences, and the associated risks, including, for example, the risks relating to private key management and cyber security.
The bank is building financial infrastructure future by connecting traditional and digital financial ecosystems to enable clients to unlock new capabilities through scalable, secure solutions. BNY’s integrated digital assets platform seeks to serve the full spectrum of client needs, across custody, payments, trading, settlement and collateral, investment management and data.
The bank has been at the forefront of financial market evolution and powering global capital flows since its founding, connecting traditional banking infrastructure with emerging digital rails — stablecoins, tokenised money market funds and tokenised deposits — anchored in institutional trust, scale and governance.
Slavin predicted that investor demand will develop to move assets from tokenised funds into traditional vehicles seamlessly, bringing further convergence of decentralised and traditional finance.
“Once you start to consider tokenisation as a vehicle, a wrapper, a way to deliver an asset or an investment product, it has such a wide range of applications. It’s just another way to reach investors,” he said.
As more institutions focus on how these digital assets interoperate, tokenised deposits are poised to serve as the connective tissue of financial digital infrastructure.
