Tokenized assets surge puts always-on cross-border payment rails in demand
A surging tokenized asset market is forcing payment giants to rethink how cross-border settlements are made
The market for tokenized real-world assets (RWAs) has gone from virtually nothing to tens of billions of dollars in under two years, and the race to build the payment infrastructure to support it is now reshaping how cross-border transactions are settled.
Demand for always-on, round-the-clock settlement is emerging from three fronts at once: remittances, corporate treasury operations and a fast-growing class of blockchain-based financial assets that need a matching payment rail to function.
“What we hear about most is not the instant aspect but the always-on aspect. 24/7, after hours and always on,” said Kamran Shahin, Vice President of Product Management for Digital Assets and Blockchain at Mastercard.
“The tokenized RWA space is relatively small at around $36 to $40 billion in market cap at the moment, but it was close to zero 18 months ago,” he said.
Shahin said McKinsey projects the market will reach $2 trillion by 2033, with BlackRock’s BUIDL fund among the early movers, bringing tokenized US dollar Treasury funds onto blockchain infrastructure. If the assets being traded are on the blockchain, the money used to settle those trades needs to be there too.
Large business-to-business (B2B) transactions, including corporations paying suppliers and treasury and cash management operations, represent a second major driver of demand. Remittances are also under pressure, where the need to move money on weekends and outside banking hours is particularly acute. Merchants, meanwhile, are seeking faster payouts at lower cost.
Joe Vollono, chief executive of stablecoin infrastructure company STBL, said the economics of the stablecoin market itself are about to change as a result. Under the current model, pioneered by Tether, a user deposits a dollar and receives a digital dollar in return. The issuer then captures the yield by purchasing US treasuries.
“If you think about the traditional model, a user provides the capital and the issuer captures the yield. You give them a dollar, they give you back a digital dollar. They take your dollar, buy a treasury and keep 4% for themselves,” Vollono said.
“That business model has been enormously successful for Tether, and they are one of the most profitable companies on the planet. Our hypothesis is that we’re entering an era in which everyone will want to participate in the economics of stablecoins,” he said. “The model that has made Tether so much money is not going to be the model of tomorrow, because everybody sees the opportunity in front of them.”
STBL has developed a model that separates the principal of the asset from its yield component. A user locks tokenized treasuries or money market funds into a protocol and receives both USST, a fully dollar-denominated stablecoin, and a non-fungible token (NFT) representing the yield accrual right on the underlying collateral.
This allows the stablecoin to be spent freely while the yield accrues separately. Vollono said corporates, enterprises, institutions and even sovereign entities will increasingly seek to capture stablecoin economics to fund new products and services, using the principal stablecoin to move money cross-border in real time.
Governance gap
The discussion took place at the Digital Assets Forum 2026, organized by the European Blockchain Convention in London.
The panel, titled “Instant Cross-Border Payments: A Risky Business?”, was moderated by Anne-Sophie Kappel, Executive Director of the Digital Euro Association. It brought together executives from Mastercard, Visa, JPMorgan’s Kinexys platform, Aave Labs and STBL.
Governance emerged as the central obstacle to realizing the promise of instant cross-border settlement. Shahin said the new technology enables efficiencies, but smart contracts alone cannot substitute for a shared framework of rules.
“Smart contracts can help you codify rules and automate a lot of things. However, when technology inevitably runs into its limits, you need someone to turn to. You need a common set of rule books, and that is probably the most important prerequisite to achieving true interoperability,” he said.
He identified two specific barriers. The first is the tension between the transparency blockchain provides and the privacy commercial transactions require, a challenge that remains in its early stages. The second is the absence of common governance standards across different transaction types and networks.
Mehtaj Syed, EMEA Head of Business Development at Kinexys, used a striking analogy to describe the challenge of scaling. Kinexys, formerly known as Onyx, is J.P. Morgan's institutional-grade blockchain and digital finance unit.
“The speed can be taken care of by the technology, but the scaling can only be taken care of by governance,” he said.
“It is a bit like world peace, and all of us want world peace, but it doesn’t exist today because everybody has a different definition of it and their own interests,” he added.
Syed predicted that bridges connecting similar private-sector players, such as two large banks or two card networks, would be in place by 2026 or mid-2027, with links between different clusters of private players following by mid-2028. He said a bridge between the public and private sectors would take longer.
“In the States, the GENIUS Act [Guiding and Establishing National Innovation for US Stablecoins Act] was a watershed moment. I spent years working with banks on digital assets, and a lot of them were trying to figure out how to engage in this space. That’s all behind us now, and it’s in large part because of legal and regulatory certainty,” Vollono said.
He added that the next catalyst would be the US market-structure bill, currently under debate in the Senate Banking Committee. Both banks and stablecoin companies have an incentive to advance the legislation, and its passage would unlock major institutional activity that remains on the sidelines.
Banks meet blockchain
As traditional financial institutions weigh their options, major payment networks and banks are already moving, each finding their own path into the stablecoin era.
Alexandra Soroko, Growth Products Senior Director at Visa, said her company is integrating stablecoins into its existing network rather than building a parallel system.
“To me, interoperability means building on a network model that allows anyone to pay anywhere, anytime, in a secure way,” she said.
Visa is enabling crypto wallet holders to spend at any of its 150 million acceptance locations worldwide using a Visa card, combining the existing acceptance network with stablecoin balances. It is also offering USD Coin (USDC) settlement seven days a week as an alternative to traditional US dollar settlement.
Soroko said traditional financial institutions globally are broadly aware they need to act on stablecoins, but that identifying use cases and building infrastructure will take time. Visa is also deploying services to help fiat-only institutions begin offering cross-border services that push money into stablecoins and digital wallets.
Kinexys took a similarly pragmatic approach to driving institutional adoption. Syed said the platform, which has moved $3 trillion on its rails to date as part of JPMorgan’s broader $10 trillion daily payment flows, won over corporate clients by making blockchain infrastructure look and feel like ordinary banking.
“When a client asks us for a US dollar account, they don’t ask us if it’s on cloud or AWS. They just ask for a bank account. So we said: we take care of the technology. You have a bank account that can move money 24/7,” she said.
Kinexys launched blockchain deposit accounts that operate on round-the-clock blockchain rails but remain ordinary deposit accounts from a legal, regulatory and accounting standpoint. More recently, it introduced deposit tokens, which are representations of commercial bank money that can now move on public blockchains.
On decentralized finance (DeFi) regulation, Stani Kulechov, founder and chief executive of Aave Labs, said the technology layer should remain permissionless while financial services built on top of it are regulated.
“DeFi and blockchain bring more transparency, guaranteed execution through smart contracts, accountability and access. But at the same time, they bring new types of risk,” he said. “If you don’t have the typical custodian risk, that might translate into risks in the underlying protocols.”
Regulatory frameworks for DeFi are being developed in the US market-structure bill, while the EU and UK are in a catch-up phase. As governance standards mature and user experience improves, panelists broadly agreed the infrastructure for always-on, cross-border payments is being built up piece by piece, jurisdiction by jurisdiction.