The first wave of asset tokenization has become a missed opportunity, but the next wave of opportunities can still be grasped.

Source: Cointelegraph Original text: "The first wave of asset tokenization has become a missed opportunity, but the next wave of opportunities can still be grasped."

Author's view: Arthur Breitman, co-founder of Tezos

In 2019, the financial sector witnessed a surge in "Security Token Offerings" (STO). The concept itself is very straightforward: representing traditional securities—such as bonds, stocks, and even structured products—on the blockchain to reduce issuance costs and expand reach. The core focus is on the primary market, that is, issuing tokens that correspond to real-world assets. Some issuers see it as a way to reduce back-office operating costs, while others believe that tokenization can attract a new type of investor, particularly those crypto users who have just accumulated wealth and wish to diversify their assets.

However, after the hype subsided, the results were disappointing. Although the technology did bring marginal cost savings, most tokens did not deliver a true breakthrough. Why? One reason is that these neatly packaged tokenized securities lack the "excitement" or "uniqueness" that crypto users seek — they prefer volatility, cutting-edge technology, and alternative assets. There is an "impedance mismatch" between the target "distribution channels" and the crypto market: the products do not match the audience.

Blockchain is not just a digital filing cabinet.

The early wave of tokenization also missed another opportunity, which was to overlook the potential of the secondary market. After all, blockchain is not just a digital filing cabinet. Its real advantage lies in the ability to enable efficient and seamless transactions in a cross-border and cross-time zone context. Many early projects merely hashed the shareholder structure onto the blockchain and called it "tokenization," hoping that this form itself would bring liquidity. But in reality, they often did not.

This field, which should have been at the forefront of innovation, has ultimately devolved into a routine task for the bank's innovation department, before being brought to market by the sales team, hoping that the "freshness" would automatically generate demand. However, if the real market friction issues are not addressed, genuine interest will naturally not arise.

Fast forward to today, the narrative is beginning to shift, especially in markets where structural frictions do exist. People's attention is no longer focused on the tokenization of assets that have long been common (such as gold or mainstream stocks), but rather on asset classes like commodities, which have high entry barriers and weak price discovery mechanisms. Uranium is a typical example. As a key raw material for the nuclear energy industry, the importance of uranium is continuously rising as the global energy system seeks low-carbon and stable baseload power.

The AI boom and the enormous data centers further highlight the importance of stable, clean energy. However, for a long time, the uranium market has lacked transparency and has been difficult to access. Traders need to deal with complex bilateral relationships, a lack of spot trading platforms, and inefficient price discovery mechanisms, resulting in limited market participants and extremely scarce liquidity.

End "pseudo-tokenization"

This is precisely where blockchain-based tokenization can bring about substantial change. By representing physical uranium on-chain and embedding it within a regulated, compliant trading environment, a high-friction market can become more accessible. Rather than being a "novelty" that cloaks commodities in a digital facade, it addresses a real problem—global traders can now enter the spot uranium market at a lower threshold for the first time.

A smoother trading environment encourages broader participation and brings more accurate price signals. Unlike early STO projects that tried to attract crypto users who "showed no interest" in these products, uranium tokenization truly attracts participants who need better access channels.

This is not "pseudo-tokenization". Rather, it is about handling KYC and regulatory requirements through powerful smart contracts and compliant modules, ensuring that the market is both secure and open, perfectly combining the liquidity advantages of decentralized infrastructure with the safety of traditional markets. The result is a more efficient system: faster transaction settlement, simpler custody, and significantly improved global accessibility. Traders can finally enjoy the results of blockchain's original promise: a low-friction, high-liquidity market.

Blueprint for Successful Tokenization

The case of uranium provides a blueprint for other high-friction bulk commodities and niche markets. Imagine the key metal markets that are crucial for the transition to clean energy, such as cobalt, lithium, and rare earths. These materials are essential for modern industry, yet their markets are as complex and opaque as the past uranium market. By following the same logic—focusing on secondary trading, establishing global issuance channels that match assets with audiences, and ensuring compliance with regulations—we can create a more efficient commodity token market, optimizing resource procurement, pricing, and trading methods.

This approach is successful because it solves real pain points. In contrast, early tokenization was more of a channel building chasing "crypto whales". But now, as long as we really tap into the strengths of on-chain technology, we can use it to solve market inefficiencies. In the case of uranium, connecting suppliers, traders and end-users will lead to a more efficient and transparent market structure for the nuclear energy industry.

For other commodities, tokenization can also bring numerous benefits, from accelerating settlement speeds to expanding the accessibility of global trade, and providing more reliable market signals for industries that rely on these resources.

The era of tokenization as a marketing gimmick is over. It is now time to focus on where blockchain can truly bring about change. In markets like uranium, which are frictional, have limited liquidity, and high barriers to entry, we can realize the original promise of blockchain – to build more efficient, transparent, and user-centric markets. This is a more forward-looking approach that goes beyond terminology and delivers tangible, measurable value.

Author's viewpoint: Arthur Breitman, co-founder of Tezos

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This article is for general reference only and does not constitute legal or investment advice. The views expressed in this article are solely those of the author and do not represent the position or views of Cointelegraph.