Nasdaq CEO Adena Friedman stated that tokenization in financial markets could release billions of dollars in funds currently locked up as collateral, and claimed that this could change the way banks and other financial institutions transfer assets within the global financial system.

According to CNBC, during a meeting in TOKEN2049 in Singapore, Friedman pointed out that government bonds, stocks, and money market funds are assets that could become more liquid due to tokenization. She stated that tokenizing these instruments along with capital flows could make it easier to transfer collateral.

In the financial market, tokenization refers to the process of representing assets such as stocks and bonds as digital tokens that can be transferred through blockchain technology.

Tokenization and the Transformation of the 24/7 Financial Market

Friedman indicates that to achieve 24/7 trading, significant adjustments are required in addition to the exchange system. Financial institutions must continuously manage risks and collateral, rather than relying on updating their systems after market closures to handle these processes.

She said, "Everything must always be done in real-time."

She also stated that artificial intelligence is expected to play an increasingly important role in this type of real-time risk management. Friedman mentioned that NASDAQ has already introduced digital agents in its risk management platform, which initially provide suggestions; in the future, banks may use them to take more direct actions.

Co-CEO Kraken stated that interest in tokenization from companies outside of the United States is on the rise, and these companies also wish to gain more convenient access to the U.S. capital market, including international enterprises that are considering listing in the U.S.

Friedman warns that round-the-clock trading is not suitable for all assets: "Not every asset is liquid enough to support a 24/7 environment."

As an example, Sethi mentions a company with an annual revenue of about 25 million US dollars that is exploring different options for entering the capital market.

This article was assisted by artificial intelligence and has been reviewed by an editorial team.