In a significant move for the UK's financial landscape, major players like BlackRock and HSBC are backing an initiative aimed at harnessing tokenization to potentially add $44 billion to the economy. This effort, which has garnered support from 54 firms, is spearheaded by Christopher Woolard, a key figure in the British government's digital market strategies and former interim head of the Financial Conduct Authority.
The concept of tokenization revolves around transforming the ownership of various assets such as bonds, funds, and real estate into digital tokens, securely recorded on a blockchain. Advocates of this approach argue it can significantly lower costs, speed up settlement processes, and liberate capital that is currently stuck in outdated operational systems.
According to a study by Barclays and PwC, the economic benefits of tokenization could contribute up to $44 billion (£33 billion) to the UK’s output by 2035. Interestingly, two-thirds of this growth is expected to occur outside the financial sector, indicating a broader impact on the economy. It's worth noting that this estimate represents an optimistic scenario, suggesting that the UK could emerge as a leading hub for tokenization while other regions, like the US and Europe, follow suit.
However, a more conservative outlook suggests a potential annual gain of around $29 billion (£22 billion) alongside an additional $19 billion (£14 billion) in tax revenue. These figures highlight the early stages of the tokenization market. In 2025, the value of tokenized real-world assets was approximately $30 billion, a fraction of the global market. Yet, that number surged by around 300% within the year.
Consultancy BCG anticipates that by 2035, the total value of tokenized assets could soar to around $55 trillion, reflecting the enormous growth potential in this sector. Despite the optimistic projections, recent research indicates that over 56% of the tokenization market remains inactive on-chain, pointing to a significant opportunity for future expansion.
BlackRock's involvement shines a light on the evolution of traditional finance. As the largest asset manager globally, it operates BUIDL, the largest tokenized US Treasury fund, valued at about $2.4 billion. Additionally, HSBC has made strides in the digital space by issuing digital bonds through its innovative Orion platform.
This taskforce, consisting of prominent institutions like JPMorgan, Goldman Sachs, and Deutsche Bank, illustrates the collaboration between traditional financial entities and crypto-native firms such as Circle and Ripple. The combined efforts of these financial giants indicate a solid commitment to establishing a robust tokenization framework in the UK.
As the market for tokenized assets continues to evolve, this initiative could play a critical role in reshaping the financial landscape. For those keeping an eye on developments in this area, Circle's recent approval and other significant events highlight the growing interest and momentum within the financial technology space.
This material is for informational purposes only and does not constitute financial advice.
