Tokenization: The Foundation of a New Financial Architecture or Just a Digital Product?
15 May 2026 | Linkedin: Tokenization: The Foundation of a New Financial Architecture or Just a Digital Product?
As the BCTR Banking and Finance Working Group, we organized an event hosted by Türkiye İş Bankası on 5 May 2026 titled “Tokenization: The Foundation of a New Financial Architecture or Just a Digital Product?”
Our aim was to discuss how financial institutions in Türkiye interpret tokenization in light of global developments. At the event, where I participated both as moderator and speaker, we brought together valuable voices from the worlds of finance, technology, and investment.
The speakers included:
- Sabri Gökmenler , CTO İşbank
- Engin Ertilav, CTO Yapı Kredi Bank
- Muhammet Cerit, CEO Misyon Bank
- Şant Manukyan, Deputy CEO İş Yatırım
Why Did We Discuss Tokenization as a New Architectural Focus?
Tokenization was one of the key topics at Davos the 2026 World Economic Forum Annual Meeting 2026, as momentum in tokenized finance continues to accelerate. US Treasury bonds are already being tokenized by institutions such as BlackRock and JPMorgan Chase, and the market has grown from USD 2 billion to USD 10 billion within just 18 months.
The International Monetary Fund’s recent note titled “Tokenized Finance” pushed the discussion even further. Its central question is whether tokenization is merely a marginal efficiency improvement — or a structural reconfiguration of financial architecture itself.
What Is Tokenization?
In its simplest form, tokenization is the representation of financial assets and liabilities — such as money, securities, and derivatives — as tokens on programmable digital distributed ledgers.
The difference between tokenization and traditional systems is fundamental.
In conventional financial systems, ownership/possesion exists through records maintained in centralized databases by trusted intermediaries. Transactions are completed through sequential processes involving messaging, reconciliation, and legal confirmations. In tokenized systems, however, ownership and transfer are embedded directly into the digital asset itself. A tokenized security is no longer merely a reference to an off-chain legal claim; it becomes a digital object that can be verified and executed directly on the ledger. For example, in the traditional system, when purchasing a stock, ownership is reflected as an entry in the databases of institutions such as Takasbank or the Central Securities Depository. Ownership depends on centralized records maintained by intermediaries.
In a tokenized system, the asset itself exists as a token on a blockchain. Whoever holds the token owns the asset — without needing to rely on a separate registry or institution. Transfers also occur directly between parties without waiting for intermediary approval, while the ledger verifies the transaction instantly.
Although digitalization is already highly advanced today, tokenization differs from traditional digitalization in three critical ways: programmability, shared distributed ledgers, and instant settlement finality.
As these features converge, the center of risk shifts from institutions to infrastructure and code. Traditional systems manage failures through institutional buffers and legal frameworks, whereas tokenized systems rely on the correctness, resilience, and governance of code.
Where Does This Transformation Become Tangible?
This transformation is becoming visible across three major areas:
- In banking, tokenized deposits could unify payments, settlement, and liquidity management within a single infrastructure.
- In capital markets, delivery-versus-payment can occur atomically, while collateral management becomes real-time.
- Financial market infrastructures are also evolving, as clearing parties and payment systems increasingly experiment with — and in some cases implement — distributed ledger technologies. Examples include SIX Digital Exchange and Paxos.
These developments raise critical questions:
Who will provide the settlement asset — the ultimate form of money — in a tokenized system? How will risks be managed when financial logic is embedded into code? How will legal certainty be ensured?
As we know, in the traditional financial system, interbank settlement occurs using central bank money — through accounts held at institutions such as the Central Bank of the Republic of Türkiye or the Federal Reserve System.
Now imagine a tokenized system where payments are made using stablecoins or tokenized bank deposits. If these assets become settlement assets, the system may move away from the safest anchor: central bank-controlled money. This could create significant risks for both the financial system and the broader economy.
This is precisely why the IMF advocates for wholesale CBDCs — to ensure that even within tokenized systems, the settlement asset remains the safest form of money available.
And these questions bring us directly to the core of our discussion:
Is tokenization merely an IT infrastructure upgrade, or does it represent a profound architectural transformation?
Key Takeaways from the Event
The main insights emerging from the discussions were:
- An Alternative Paradigm: Tokenization offers a decentralized, immutable, and 24/7 operational technological architecture as an alternative to traditional centralized banking systems.
- Hybrid Structures and Secure Bridges: Due to technical differences, a full convergence between traditional systems and blockchain architectures appears unlikely. Instead, the future will likely involve hybrid models connected through secure bridges.
- Digital Silos and Interoperability: If institutions or countries build isolated closed networks, liquidity fragmentation and “digital silos” may emerge. Cross-network interoperability standards will therefore become essential.
- The Anchor Role of Wholesale CBDCs: To preserve the principle of singleness of money and maintain trust within the financial system, central bank digital currencies — particularly wholesale CBDCs — may need to act as the system’s anchor.
- Financialization of Idle Assets: From a capital markets perspective, tokenization could unlock enormous value by transforming illiquid assets such as artworks, antique vehicles, and real estate into collateralizable financial assets.
- Governance of Code and Risk: As risk shifts toward code, robust governance, independent audits, and emergency intervention mechanisms will become strategic necessities to prevent cascading failures caused by smart contract vulnerabilities.
- Invisible Banking and Next-Generation Custody: Banks may become increasingly “invisible” in the future, while continuing to play a trusted role through custody services and digital asset verification.
- The Global Dollar Battle and Stablecoins: The growing use of US dollar-backed stablecoins may reinforce US influence over the global financial system, resembling a more tightly controlled version of the Eurodollar system.
- The Direction of Türkiye’s Financial Sector: Banks in Türkiye are approaching blockchain technologies through experimental environments and dedicated subsidiaries, particularly focusing on custody services and integrating existing digital capabilities into this emerging ecosystem.
In conclusion, tokenization presents a transformative alternative paradigm with the potential to reshape rigid and centralized financial structures. For Türkiye’s financial sector, however, long-term success will depend on building a hybrid and resilient ecosystem — one that combines the regulatory discipline and trust accumulated by traditional finance with the transparency and programmability offered by blockchain technologies.
Sources:
1) Youtube record. English subtitle exist.https://www.youtube.com/watch?v=OXYOzb10rmk&t=2778s
2) Tokenized Finance – IMF Notes 2026
https://www.imf.org/-/media/files/publications/imf-notes/2026/english/insea2026001.pdf
3) WEF Davos 2026 – BlackRock, Citadel & Lagarde Clash Over $38 Trillion U.S. Debt, AI & Market | AQ1B
https://www.youtube.com/watch?v=uKNK0TT5fW0
4) WEF Davos 2026 – Is Tokenization the Future? | World Economic Forum Annual Meeting 2026
https://www.youtube.com/watch?v=CBW7Sl9PmDI
