Brian Armstrong, the CEO of Coinbase, says tokenized assets could create an entirely new generation of financial companies, much like the iPhone enabled businesses such as Uber, TikTok and Coinbase that were difficult to predict before the smartphone era.
In a recent post on X, Armstrong argued that blockchain-based tokenization could become a foundational technology for financial innovation. While the immediate benefits of tokenized assets are already becoming clearer—including global access, greater utility and 24/7 trading—he believes the larger opportunity could be the creation of financial companies and services that do not yet exist.
Armstrong Compares Tokenization to the iPhone Revolution
Armstrong used Apple’s iPhone as an analogy for the potential impact of tokenized assets.
The iPhone did not specifically predict the creation of companies such as Uber or TikTok. Instead, the smartphone created a technological platform that enabled entrepreneurs to develop entirely new products and business models.
Armstrong believes blockchain infrastructure could play a similar role in finance.
“Apple didn’t predict Uber, TikTok, or Coinbase. But the iPhone enabled an entirely new wave of companies.”
He added that tokenized assets on blockchains could follow a similar path, creating a new generation of financial companies beyond the applications currently visible today.
What Are Tokenized Assets?
Tokenization refers to representing ownership or economic rights connected to an asset through digital tokens recorded on a blockchain.
The assets being tokenized can potentially include:
- Stocks
- Bonds
- Investment funds
- Real estate
- Private equity
- Commodities
- Currencies
- Bank deposits
A tokenized asset does not necessarily mean that the underlying asset becomes a cryptocurrency. Instead, blockchain technology can be used as part of the infrastructure for recording ownership, transferring assets and settling transactions.
The potential benefits often cited by the industry include faster settlement, lower operational costs, fractional ownership and around-the-clock market access. However, regulatory and investor-protection questions remain important as tokenized markets develop.
Armstrong Says the Biggest Opportunities May Not Yet Exist
Armstrong’s central argument is that the most significant impact of tokenization may not come from simply putting existing financial assets on a blockchain.
Instead, new infrastructure could enable entrepreneurs to build financial products and companies that would not have been practical using traditional market systems.
The immediate benefits of tokenized assets are already relatively easy to identify, according to Armstrong. These include:
- Global access: Digital infrastructure could potentially allow eligible investors to access markets across geographical boundaries.
- 24/7 trading: Blockchain networks can operate continuously, unlike many traditional financial markets with limited trading hours.
- Greater utility: Smart contracts could make financial assets more programmable.
- Faster settlement: Tokenized systems could potentially reduce the time required to complete and reconcile transactions.
But Armstrong’s larger prediction is that these capabilities could combine to create entirely new business models.
Tokenization Is Moving Beyond Crypto
The idea of putting traditional financial assets on blockchain networks is increasingly attracting interest from major financial institutions.
Wall Street firms, banks and market infrastructure companies have been exploring tokenized securities, deposits and money-market products as potential ways to modernize settlement and trading systems.
For example, banks have increasingly explored tokenized deposits, which represent traditional bank money using digital infrastructure.
Major institutions are also examining how blockchain technology could support faster transfers, automated settlement and more efficient treasury operations.
This institutional interest suggests that tokenization is gradually moving from an experimental crypto concept toward a broader financial technology strategy.
Coinbase Is Betting on an On-Chain Financial System
Armstrong’s comments also align with Coinbase’s broader strategy of expanding beyond traditional cryptocurrency trading.
The company has increasingly focused on building infrastructure that connects blockchain technology with a wider range of financial assets and services.
Coinbase has previously promoted tokenized stocks and other on-chain financial products as part of its longer-term vision for a more accessible global financial system.
The company has argued that blockchain infrastructure could eventually support a broad range of assets, bringing elements of traditional finance and digital asset markets closer together.
Why 24/7 Markets Could Change Financial Services
One major difference between blockchain networks and traditional financial infrastructure is operating time.
Many traditional stock and bond markets follow specific trading schedules. Settlement can also take place after a transaction is executed.
Blockchain networks, by contrast, can operate continuously.
A tokenized financial system could potentially support transactions at any time, although real-world regulation, liquidity and market infrastructure would still determine how such services operate.
Continuous markets could create opportunities for companies building new financial products around:
- Global trading
- Automated investing
- Instant settlement
- Programmable payments
- Fractional ownership
- AI-driven financial services
- Real-time collateral management
These applications remain at different stages of development, but they illustrate why industry executives see tokenization as more than simply a new way to package existing assets.
Smart Contracts Could Create More Programmable Finance
Another major component of tokenization is the use of smart contracts.
Smart contracts are programs that can execute predefined actions on a blockchain when specified conditions are met.
In finance, this technology could potentially automate processes that currently require manual reconciliation or multiple intermediaries.
For example, future financial services could potentially use smart contracts for automated payments, collateral management or conditional transactions.
However, greater automation also introduces new risks.
Software vulnerabilities, coding errors and failures in smart-contract systems could create financial losses, making security and regulatory oversight critical.
Major Financial Institutions Are Exploring Tokenization
Armstrong’s prediction comes as major financial institutions accelerate their interest in blockchain-based financial infrastructure.
Wells Fargo, for example, has announced plans to introduce tokenized deposits for corporate and commercial clients, reflecting a growing push among banks to use blockchain technology for payments and transfers.
More broadly, financial institutions are exploring how tokenized securities, deposits and funds could improve market infrastructure.
The potential benefits include reduced settlement times, improved operational efficiency and the ability to move certain financial assets more easily across digital networks.
However, widespread adoption still depends on regulation, interoperability and the development of reliable market infrastructure.
The Next Uber of Finance May Not Exist Yet
Armstrong’s comparison with the iPhone highlights an important point about technological change: the biggest companies created by a new platform are not always obvious when the technology first appears.
Smartphones initially improved communication and internet access.
But their combination with app stores, GPS, mobile payments and high-speed networks eventually created entirely new categories of businesses.
Armstrong believes blockchain tokenization could follow a similar pattern.
The technology could initially improve existing financial services. Over time, developers could combine tokenized assets with artificial intelligence, smart contracts, digital identity and global payment networks to create services that are difficult to predict today.
This remains a long-term industry vision rather than a guaranteed outcome.
Regulatory Challenges Remain
Despite growing enthusiasm around tokenization, major regulatory questions remain.
A token representing a stock, bond or other financial asset may be subject to securities laws and other regulations depending on its structure and jurisdiction.
Regulators must also address questions involving:
- Investor protection
- Custody
- Ownership rights
- Redemption
- Market manipulation
- Cross-border transactions
- Data privacy
- Blockchain security
Tokenization does not automatically remove the legal requirements associated with the underlying asset.
The regulatory framework surrounding tokenized securities remains an important factor that could determine how quickly the sector develops.
Interoperability Could Be Critical
Another challenge is interoperability.
The tokenization industry is developing across multiple blockchain networks and financial platforms.
If tokenized assets cannot move efficiently between systems, liquidity could become fragmented.
Financial institutions and technology providers are therefore working on infrastructure that can connect different blockchain networks and existing payment systems.
Industry adoption may depend not only on the benefits of individual tokenized products but also on whether different systems can communicate effectively with each other.
Tokenization Could Reshape How Assets Are Owned and Traded
The long-term promise of tokenization extends beyond trading.
Digital tokens could potentially change how investors access and manage ownership in assets that have traditionally been difficult to divide or transfer.
For example, tokenization could make fractional ownership easier for certain asset classes, subject to regulatory requirements.
It could also enable more automated systems for distributing payments, transferring ownership or managing collateral.
These capabilities could create opportunities for startups and financial technology companies that operate differently from traditional banks, brokerages and exchanges.
That possibility is at the center of Armstrong’s prediction.
Not Every Tokenized Asset Will Succeed
The growth of tokenization does not guarantee that every blockchain-based financial product will succeed.
Financial markets depend heavily on trust, liquidity, legal certainty and reliable infrastructure.
A tokenized version of an asset may not automatically offer better liquidity or lower costs than an existing system.
The industry will also need to demonstrate that blockchain-based infrastructure provides meaningful advantages over traditional technology.
Cybersecurity and operational risks remain additional concerns.
As a result, tokenization’s long-term growth will likely depend on practical use cases rather than technology alone.
What Armstrong’s Prediction Means for the Crypto Industry
For the cryptocurrency industry, Armstrong’s comments represent a broader shift in the narrative around blockchain technology.
The industry is increasingly focusing on real-world assets (RWAs) and the tokenization of traditional financial products.
Rather than limiting blockchain networks to cryptocurrencies such as Bitcoin and Ethereum, companies are exploring how the technology could support conventional financial markets.
If Armstrong’s prediction proves correct, future blockchain companies may not necessarily identify primarily as crypto companies.
They could instead operate as:
- Digital investment platforms
- Global financial marketplaces
- Automated settlement companies
- Tokenized asset managers
- Programmable finance providers
- AI-powered financial services
- Digital infrastructure companies
The boundaries between traditional finance, fintech and crypto could become increasingly difficult to distinguish.
Conclusion
Coinbase CEO Brian Armstrong believes tokenized assets could create an entirely new generation of financial companies, comparing the potential transformation to the iPhone’s role in enabling companies such as Uber, TikTok and Coinbase.
Armstrong argues that the immediate advantages of tokenized assets—including global access, greater utility and 24/7 trading—are only the beginning. His larger prediction is that blockchain infrastructure will enable new financial business models that have not yet been imagined.
The idea comes as major banks, financial institutions and crypto companies accelerate their investment in tokenized deposits, securities and other blockchain-based financial products.
However, the industry’s future remains dependent on regulatory clarity, security, interoperability and real-world adoption.
For Armstrong, the most important question may not be which existing assets will move on-chain, but which entirely new financial companies will emerge once tokenized assets become a widely available foundation for innovation.
Also Check: HMRC Reveals £1.38B in Taxable Crypto Gains for 2024–25
