TOKENIZATION OF REAL-WORLD ASSETS: IMPLICATIONS FOR INVESTMENT OPPORTUNITIES, LIQUIDITY, AND FINANCIAL MARKET EFFICIENCY

Jean-Pierre Sfeir

doi:10.5281/zenodo.23552491

Abstract

Tokenization, the representation of ownership rights in real estate, bonds, equities, funds and other real world
assets as digital tokens on a blockchain, is moving from pilot projects into the plans of large asset managers and
banks. Its supporters promise fractional ownership, wider investor access, faster settlement and deeper secondary
markets. This paper tests those promises against the available evidence through a structured narrative review of
twenty sources spanning token offerings, settlement economics, decentralised market design and recent empirical
studies of tokenized property, stocks and government debt. The review finds strong support for gains in access
and settlement efficiency, and credible evidence that token offerings can lower the cost of raising capital for
smaller issuers. The liquidity promise is much weaker. Most tokenized assets trade rarely, holdings are
concentrated, and issuance is dominated by a small number of large institutions. Prices of tokenized assets also
show sensitivity to sentiment in wider crypto markets. The paper proposes a lifecycle framework for tokenized
assets and argues that efficiency gains depend less on the technology itself than on legal clarity, interoperable
trading venues, credible custody and active market making. Implications for issuers, investors and regulators are
discussed.

Keywords

Tokenization, Real World Assets, Security Token Offerings, Liquidity, Market Efficiency, Blockchain.

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