"We believe tokenization will certainly drive how the market changes, not just for ETFs but across the funds industry as a whole," Fitzpatrick said.
Tokenization News
JPMorgan's global head of ETF product says tokenization will reshape the entire funds industry, but warns that meaningful use cases remain at least two years away. Ciarán Fitzpatrick made the remarks in a post published Friday, outlining the bank's current thinking on digital asset infrastructure.
"We believe tokenization will certainly drive how the market changes, not just for ETFs but across the funds industry as a whole," Fitzpatrick said. He pointed to faster creation and redemption cycles, near-instant settlement, and continuous market access as potential benefits of tokenizing exchange-traded funds. "My view on tokenization is that it will become part of the ETF ecosystem, but we're a couple of years away from some good use cases," he added.
JPMorgan is already exploring applications through Kinexys, its internal blockchain business unit. The bank's work remains in the research and experimentation phase, with no commercial rollout announced. Fitzpatrick did not specify which use cases Kinexys is currently prioritizing.
Traditional funds and equities have become a natural focus for tokenization because they trade on exchanges that close on weekends. Continuous settlement and after-hours access would represent a practical improvement over current market infrastructure. That operational gap has drawn attention from both financial institutions and regulators.
SEC Commissioner Hester Peirce recently encouraged firms working on tokenized products to engage directly with the agency. The SEC has already approved a rule change allowing Nasdaq to support tokenized share trading. The New York Stock Exchange, Robinhood, Kraken, and Coinbase are each working on tokenized equities offerings of their own.
Analyst projections for the tokenized asset market vary considerably, but most point toward growth measured in trillions. Estimates range from around $2 trillion to more than $10 trillion in total tokenized assets by 2030. The wide range reflects uncertainty about how quickly regulatory frameworks will develop and how fast institutional adoption will follow.
JPMorgan's position reflects a growing consensus among large financial institutions that tokenization is a structural shift worth preparing for, even as the industry waits for the first genuinely scalable use cases to emerge beyond proof-of-concept.
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