Tokenisation is progressing at the infrastructure level, but questions remain over how onchain markets will support institutional liquidity.
Speaking on the “Active edge: ETFs that think ahead” panel at ALFI Global Asset Management, Andrew Craswell, principal and European head of client relationship management at Brown Brothers Harriman, pointed to the growing use of blockchain to record fund units, particularly for post-trade efficiency.
However, Craswell highlighted that this is only one part of the equation.
“The next step is how to create liquidity on-chain with trusted counterparties,” said Craswell.
“The strength of the ETF model today lies in its reliance on trusted counterparties and centralised points of liquidity.”
The speaker highlighted an infrastructure gap, while tokenisation is advancing in issuance and settlement, it has yet to replicate the liquidity dynamics that underpin existing ETF markets.
Until these conditions are established, the ability for tokenised structures to operate at institutional scale is constrained, positioning liquidity as the upcoming challenge in the convergence of traditional and on-chain market infrastructure.
