The Tokenization of Everything Has Quietly Begun

More than $1 trillion in securities settle every single day in U.S. markets. When that machinery works, no one notices. When it strains, everything else in the system becomes secondary.

In late 2025, U.S. regulators made a decision that directly touches that machinery. Without a press release or a rule rewrite, they permitted tokenized representations to be used inside clearing, settlement, and record-keeping processes under existing securities law. It was not framed as innovation. It was framed as permission.

That distinction matters.

This article explains what regulators actually allowed, why they allowed it now, and why this moment marks the beginning of something broader than digital assets. It addresses a real institutional problem: when scale turns settlement itself into a source of risk.

If you work anywhere near capital markets, custody, asset servicing, treasury, or risk, this is the part of the system you cannot afford to misunderstand.

Why Settlement, Not Trading, Is the Real Pressure Point

Markets focus on trading because trading is visible. Institutions focus on settlement because settlement is final.

Ownership becomes legally real at settlement. Credit exposure ends at settlement. Liquidity is released back into the system at settlement. Everything else remains provisional until that moment.

In U.S. markets, these functions are concentrated inside infrastructure operated by the Depository Trust & Clearing Corporation. According to DTCC disclosures, its subsidiaries process over $2 quadrillion in securities transactions annually, with average daily settlement values exceeding $1 trillion.

At that scale, settlement is not a back-office detail. It is where systemic risk either collapses or compounds.

This is why people closest to post-trade infrastructure tend to speak less about opportunity and more about pressure.

A Perspective Worth Taking Seriously

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