Australia could be left watching from the sidelines as asset tokenization scales into a multi-trillion-dollar market, according to the country’s top financial regulator. Speaking Wednesday, Australian Securities and Investments Commission Chair Joe Longo warned that failing to embrace tokenization would turn Australia into a passive consumer of innovation built elsewhere.
To counter that risk, ASIC plans to relaunch its Innovation Hub, signaling a renewed push to modernize financial markets rather than defend legacy systems.
A $16 Trillion Opportunity Is Taking Shape
Addressing the National Press Club, Longo framed the moment as a clear fork in the road. Innovate or stagnate. While Australia was an early adopter of electronic trading infrastructure, other jurisdictions are now moving faster, especially in tokenized finance.
That slowdown is striking, given that Australia issued its first tokenized bond in Sydney back in 2018. Since then, momentum has shifted offshore. Real-world assets worth $35.8 billion are already on-chain globally. Boston Consulting Group estimates that figure could climb to $16 trillion by 2030, while McKinsey projects a more conservative but still massive $2 trillion over the same period.
Longo compared distributed ledger technology to the introduction of CHESS, the system that once reshaped Australian securities settlement.
The implication was clear. Tokenization could redefine capital markets all over again.
Global Competition Is Heating Up
ASIC’s warning comes as global financial heavyweights accelerate their tokenization plans. Longo revealed recent discussions with JPMorgan, where staff indicated the bank expects to tokenize its money market funds within two years. Four of JPMorgan’s largest funds alone hold $730 billion in assets.
In the United States, regulators are exploring 24/7 trading, a model openly supported by BlackRock CEO Larry Fink, who has advocated for tokenized stocks, bonds, and funds. Switzerland is already ahead, with its digital securities exchange issuing more than $3.1 billion in tokenized bonds since 2021.
Longo’s recent meeting with U.S. Securities and Exchange Commission Chair Paul Atkins reinforced the reality that countries are now competing directly for leadership in tokenized markets. Jurisdictional hesitation has a cost.
ASIC Reopens the Door to Innovation
To stay competitive, ASIC released updated guidance on digital asset innovation last week. The regulator says it will balance experimentation with investor protection rather than slow progress through enforcement-first policies.
The relaunched Innovation Hub will operate with an open-door approach, encouraging builders to engage early when facing regulatory uncertainty. ASIC aims to collaborate on solutions instead of simply flagging compliance risks.
Tokenization, Longo emphasized, could unlock broader access to asset classes traditionally reserved for institutions and high-net-worth investors. As capital markets transform globally, ASIC wants Australia to help shape that future rather than import it later.
