Strategy’s Michael Saylor says tokenization will let investors ‘shop’ for yield
Bitcoin Evangelist Michael Saylor said the upcoming tokenization of financial assets could change how credit and returns are priced across the economy and directly challenge traditional banking and brokerage businesses.
“The real power of tokenization is that it creates a free market in credit creation and returns for asset owners.” Strategy the founder and chairman said Thursday on CNBC’s “Squawk Box.” “So if you can tokenize a group of securities, then you can shop around to get the best loan terms and the highest yield.”
In contrast, banks effectively decide customers’ financing terms in TradFi or a traditional financial system, he added.
“In the 20th century TradFi economy, your bank decides you can’t get a loan, you can’t get a return, and there’s not a single thing you can do about it,” Saylor said. “So tokenization is a free market in capital and creates a higher velocity and higher volatility for capital assets.”
Saylor’s comments go beyond the usual approach to tokenizing “real world” assets such as stocks, bonds, funds and private credit. Enthusiasts often tout blockchain technology’s potential to enable faster payments, 24-hour liquidity, and broader access to the stock market for retail investors and, increasingly, the trading of private company shares.
The comments come as the industry holds its breath for the proposed market structure bill, known as the Openness Act, to continue advancing through Congress. If it eventually becomes law, it would, among many other things, create a legal framework for fully unchaining real-world assets.
Cryptocurrency investors also hope to receive guidance on tokenized stocks from the Securities and Exchange Commission; This would potentially allow blockchain-based representations of stocks to be traded in parallel with the traditional market. The commission published a statement expression Earlier this year, this signaled that tokenized securities would likely enter the mainstream financial sector but would still be subject to traditional securities laws.
coinbase, robinhood And Gemini currently offers tokenized stock trading to select customers.
