Morgan Stanley expects to begin supporting tokenized equities on its own alternative trading system in the first quarter of 2027, head of digital asset strategy Amy Oldenburg told The Block during the TOKEN2049 conference. The revised timetable pushes back a previous forecast for a launch in the second half of 2026 as the bank continues building the infrastructure needed to handle such assets.

Oldenburg said the new timetable was more realistic because the bank needs an available product before it can support tokenized equities on its ATS.

“We need a product in order to be able to support it within the ATS. And there really isn’t any client demand because the product itself doesn’t exist. So we just need a bit more time,” Oldenburg explained.

Morgan Stanley builds tokenization infrastructure

Oldenburg described the upcoming launch of the Depository Trust & Clearing Corporation’s tokenization service as an important milestone for the market’s development. Morgan Stanley is also monitoring the GENIUS Act taking effect in January and the wider U.S. regulatory landscape.

She said some regulatory issues remain unclear for institutional market participants, including questions involving permissions from the U.S. Federal Reserve and the CLARITY bill.

Supporting tokenized equities on its ATS forms part of Morgan Stanley’s strategy for raising, allocating and managing capital onchain. The system would allow the bank to match orders away from public exchanges, including Nasdaq.

Morgan Stanley already offers clients cash equities, derivatives and swaps under a similar model. The bank views tokenization as an extension of those services that would allow it to work with assets in traditional and onchain formats.

The bank is also developing wallet infrastructure to hold tokenized assets and products. It has created a Digital Asset Lab to test blockchain technologies and crypto infrastructure before potentially using them in new products.

Oldenburg said Morgan Stanley is examining areas that could interest clients, including perpetual futures and prediction markets. She stressed that this work does not necessarily mean the bank will launch those products.

Oldenburg forecasts growth in tokenized assets

Oldenburg identified private equities, structured notes, bespoke financial products and access to private funds as among the most promising uses of tokenization. She said blockchain technology could reduce paperwork and administrative costs in those areas.

As tokenization becomes more widespread, market participants will also need to consider whether such assets can be used as collateral, she said. Oldenburg described that prospect as the “securitization of everything.”

Oldenburg expects the market for tokenized real-world assets to reach between $3 trillion and $10 trillion by 2030. She said the industry had announced new projects actively over the previous 12 months, intensifying fear of missing out among institutional participants.

U.S. Commodity Futures Trading Commission Chair Michael Selig previously said tokenization of real-world assets could become the foundation of a more efficient financial system.

Source: Incrypted