From Wall Street to blockchain: how tokenization will reshape the American financial system

Paul Atkins, Chairman of the SEC, has sparked a crucial debate with his statement about the possible on-chain migration of the entire U.S. financial market within two years. While the timing is still under discussion, the scenario warrants a rigorous analysis: what structural transformations would accompany such a migration? This is not merely a technological upgrade but a complete re-architecture of the global financial system.

1. The Transparency Revolution: from “Black Box” to Glass

The first shock will be unprecedented levels of transparency. When government bonds, credit assets, and financial instruments migrate on-chain, every transaction will become traceable in real-time. Regulators and investors will be able to directly monitor:

• The actual liquidity of commercial banks
• The quality and real value of collateral guarantees
• The accumulation of speculative positions
• Exposure to mismatch risks, as happened with Silicon Valley Bank

This means systemic risks like the collapse of SVB could be identified proactively. However, the same transparency also amplifies contagion: bank runs could accelerate dramatically in an environment where fear spreads without physical barriers.

2. The Never-Sleep Market: Perpetual Volatility

The second change will be in operational rhythm. Say goodbye to T+1/T+2 settlement cycles: transactions will settle immediately with (T+0). The consequences are profound:

• The velocity of capital turnover will increase exponentially, structurally reducing the immobilization costs of funds
• The market will operate 24/7, eliminating the “temporal buffer” between closing and reopening
• Any global event—a geopolitical news, a commodity price crash, a exchange rate fluctuation—will impact asset prices in milliseconds
• Supervision will become “real-time monitoring,” transforming regulators from retrospective auditors to simultaneous guardians

3. The Hegemony of the Digital Dollar

Paradoxically, on-chain does not mean decentralization of state power but its reinforcement through infrastructure. If the United States tokenizes Treasuries and money market funds (MMF) first, enabling global capital to access dollar-denominated assets with maximum liquidity, unprecedented speed, and zero geographical barriers, this will constitute the most effective defense of American monetary hegemony.

Conversely, if the Eurozone and Asian markets fail to keep pace, capital will “vote with its feet,” migrating toward the more efficient and transparent on-chain ecosystem. This does not signify the decline of the dollar but rather a generational upgrade of global monetary infrastructure.

4. The Real Economy: Democratization of Capital

The unprecedented granularity of assets is perhaps the most underestimated aspect. Tokenization will enable:

• Micro IPOs for SMEs: small and medium enterprises can issue “micro-securities” compliant with regulations, without depending on the whims of traditional investment banks
• Fractionalization of illiquid assets: commercial buildings, energy plants, patents, even intellectual property rights—historically reserved for large institutions—will become fractionalized and accessible to global investors
• Liquidity premiums for U.S. assets: greater accessibility will proactively attract international capital

5. From Traditional Banking to Smart Contracts

The impact on the banking sector will be even more disruptive:

• Commercial credits, inventory, and future cash flows of companies can be collateralized directly via standardized smart contracts
• Financing efficiency will reach unprecedented levels, but supervision must evolve: from monitoring simple “on-balance sheet loans” to controlling complex “programmable leverage structures”
• Traditional intermediaries—clearinghouses, transfer agents, brokers profiting from informational asymmetries—risk being replaced by automated protocols

Winners of the transition: on-chain custody infrastructure (custodia on-chain, DID services, compliant oracle providers), next-generation asset managers, hybrid professionals who understand both financial compliance and Solidity programming.

6. The Mutation of Systemic Risks

On-chain financial crises will have a completely different morphology:

• Risks will no longer be “mass psychology” but code malfunctions: bugs in smart contracts, oracle manipulation, cross-chain bridge collapses
• Crises will explode and conclude in minutes, not months: the “rescue weekend” of the 2008 crisis will become obsolete
• Solutions will be “data-driven code patches” rather than political negotiations

7. Realism: the direction is certain, the timing is not

Complete transition in two years? Almost impossible. The obstacles are formidable: technological bottlenecks, regulatory delays, resistance from vested interests. The most probable scenario is a gradual evolution:

• Starting with Treasuries and repo markets
• Extending to OTC derivatives
• Parallel coexistence of the old and new systems
• Slow but inexorable erosion of the traditional model

However, regardless of speed, the direction indicated by Paul Atkins is irreversible. It is not merely a technological innovation but an instinctive capital shift toward greater efficiency. The future of American finance will inevitably be tokenized and on-chain. The question is not if, but when and how to manage this epochal transition.