From 1995 to Onchain: How Finance Gets Better

Speakers

From 1995 to Onchain: How Finance Gets Better

• Marek Socha, MD Global Markets at 21x
• Rafael Mastroberardino, Digital Assets at Franklin Templeton
• Matthew Dawson, Enterprise Lead at the Ethereum Foundation
• Raphaël Bloch, Cofounder & CEO at The Big Whale

The core case: one ledger instead of many

Today's financial system runs on multiple disparate ledgers that constantly need reconciling. That reconciliation is where most of the cost, risk and delay live. The on-chain thesis: replace it with one publicly verifiable ledger that everyone reads from simultaneously, and unlock programmability and composability on top of it.

The institutions that will struggle are those whose revenue depends on the inefficiencies being removed:

• Custodians whose role is partly absorbed by smart contracts
• Transfer agents facing disintermediation from native on-chain registries
• Collateral managers: the 10-20% buffer required by slow collateral movement will compress as collateral becomes portable and programmable 24/7

Native tokenization is not a digital twin

Most of what exists today is a wrapper: the token moves, but legal ownership does not, because the transfer agent and share registry stay off-chain. Franklin Templeton's Benji is built differently: the transfer agent and share registry run on-chain, so when the token moves, legal ownership moves with it. The result: instant peer-to-peer transfer, intraday yield accrual, no counterparty risk.

When institutions evaluate a tokenized product, the first two questions are always the same:

• Is the token the actual asset, or just a representation?
• Who am I facing legally? Institutions will not face a smart contract, they need a regulated counterparty

Using blockchain purely as a distribution mechanism to reach crypto-native clients is a dead end: it adds 2-3% to the customer base while doing nothing to improve the infrastructure serving the existing one.

21x collapsed the entire post-trade stack

At 21x, trading, clearing and settlement happen in a single on-chain transaction. Asset and cash (in stablecoin form) settle atomically the moment a trade is matched. Key properties:

• No clearing leg, no counterparty risk, no capital tied up between execution and settlement
• Non-custodial: assets remain with the buyer or seller at all times
• Live on two chains (Polygon and Stellar), chain-agnostic by design
• Expanding to the US, where the SEC has shown significantly more openness than European regulators under the DLT Pilot Regime

Chain selection: what institutions actually look for

For Franklin Templeton, choosing a chain is a structured decision based on internal build capacity, technical robustness, regulatory acceptance of the transfer agent on that chain, and customer demand. If enough institutional clients request a specific chain and justify it, that becomes a deployment target.

The Ethereum Foundation takes a deliberately different approach: no incentives are offered to institutions to deploy on Ethereum. Organic adoption gives products built on it long-term credibility. The properties of decentralization translate into business outcomes:

• Operational resilience and 24/7 uptime
• Censorship resistance
• Access to the deepest DeFi liquidity pool

Private chain experiments have largely failed. The emerging architecture is permissioned L2s on Ethereum connected via interoperability layers: controlled environments with access to public liquidity.

Conclusion

Once an institution has tokenized its first fund, the rest of the product range follows quickly: infrastructure and regulatory groundwork is done. The deeper shift is organizational: within five years, digital assets and traditional finance teams will merge. The ETF team will not "connect to the digital assets team." It will manage products, some of which happen to be on-chain.

The question worth tracking is not total value on-chain, but what proportion of it is productive: composing with DeFi, moving collateral across borders on a Sunday night, accruing yield intraday. London confirmed the consensus: native issuance, public chains, and full organisational integration within five years.