Tokenization push could pull trillions of dollars into DeFi, StanChart says

Standard Chartered's digital asset research team published a report projecting that tokenized real-world assets could reach $30.1 trillion by 2034, with a significant fraction routing through DeFi infrastructure for settlement, collateral management, and yield optimization. The projection is among the most aggressive from a major financial institution — and comes with a specific theory of how DeFi, not traditional finance settlement systems, becomes the operational backbone for tokenized asset markets.

The Standard Chartered Thesis

The report's core argument: traditional financial settlement infrastructure is too slow and too expensive to handle the settlement volumes that tokenization will generate. Tokenized T-bills trading at equity-market frequencies need settlement in seconds, not T+1 or T+2. Only programmable blockchain settlement provides that capability at scale.

The DeFi integration comes through collateral management. When tokenized Treasuries become widely accepted as DeFi collateral, they replace USDC and ETH as the primary collateral assets in lending protocols. Instead of borrowing against a volatile crypto asset, institutional users borrow against a yield-generating Treasury token — getting both the yield from the Treasury and liquidity from the DeFi loan. The total capital efficiency gain is significant.

Current Progress Against the Projection

$30.1 trillion by 2034 requires approximately 100x growth from current levels over nine years. That rate of growth is achievable if institutional adoption accelerates, but current trajectory requires significant inflection points that have not yet occurred.

"If you tokenize assets but settle them through legacy infrastructure, you've solved the representation problem but not the settlement problem. The efficiency gains require on-chain settlement."

• Current tokenized RWA TVL: $28.4B (approximately 0.1% of the 2034 projection)
• Required annual growth rate to reach $30T by 2034: approximately 82%
• Current annual growth rate: approximately 240% (from $3B to $28B in 12 months)
• Primary bottleneck: regulatory clarity on on-chain settlement finality across jurisdictions

The Regulatory Dependency

Standard Chartered's projection is explicitly conditional on regulatory developments that have not occurred: formal recognition of on-chain settlement as legally final in major jurisdictions, clear rules for tokenized security collateral in DeFi, and Basel capital treatment for bank holdings of tokenized assets.

The EU's MiCA framework addresses crypto-asset issuance but does not resolve on-chain settlement finality for tokenized securities. The UK's Digital Securities Sandbox is testing regulatory frameworks but at small scale. The US remains in a pre-regulatory state for most tokenized asset categories.

What the report establishes clearly is that major financial institutions now view DeFi infrastructure — not upgraded TradFi systems — as the most likely operational layer for tokenized asset markets at scale. That institutional conviction, coming from Standard Chartered rather than a crypto-native firm, is itself a signal about where capital allocation is heading over the next decade.