The financial services industry has been buzzing for years about the promise of tokenisation — the process of representing traditional assets as digital tokens on distributed ledger technology (DLT).
Asset managers and asset owners alike are waking up to the potential of enhanced liquidity, new distribution models, and a broader investor base. The Funds Europe – CACEIS survey of industry attitudes and preparation for tokenisation reveal widespread interest and rising demand for tokenised products.
The survey of asset owners highlights a striking dichotomy. On the surface, demand looks healthy: 38% report high demand for tokenised funds and assets, compared to just 12% reporting low or no demand.
Drilling into the numbers down, however, shows that the story softens with half of respondents (50%) describing demand as “moderate,” and just 8% reporting “very high” demand. In total, 88% of asset owners say demand is moderate or high, but the enthusiasm appears to be cautious rather than feverish.
A similar pattern emerges when it comes to crypto assets. Here, 42% selected one of the high-demand options, compared to 15% selecting low or no demand. Again, the largest group sat in the middle: 42% described demand as moderate. Only 10% reported “very high” demand. So, while slightly more polarised than tokenisation, the overall picture remains consistent – this is a trend people want to explore, but not a market they are clamouring to enter at breakneck speed.
When asked what benefits tokenisation could deliver, asset owners proved remarkably open-minded. Enhanced security (69%) and access to a broader range of assets (69%) were the top responses, with increased liquidity (63%) and lower transaction costs (52%) close behind.
This breadth of answers suggests tokenisation has potential to reshape multiple aspects of investment management. Yet once again, the devil lies in the detail: security resonates most strongly, while cost savings are not the headline draw.
The hurdles are equally clear. Risk management obligations (62%) and regulatory constraints (58%) dominate as the biggest perceived challenges. Limited availability of reliable service providers (52%) follows, while operational burdens are seen as less significant (31%). In short: asset owners are open to the concept, but regulatory and compliance risk looms large.
Perhaps the most telling responses came when asset owners were asked what they seek in a digital asset service provider. Financial strength (67%) and cyber security resilience (63%) ranked highest. Other factors scored solidly in the 40–52% range, but cost was lowest of all, selected by only 40%. This matches the broader theme: asset owners will pay for providers who offer safety, resilience, and regulatory comfort. Cost, in contrast, is not the deciding factor.
Asset Managers: Adoption Rising, Growth Anticipated
Asset managers, meanwhile, are further along the curve. Almost two-thirds (62%) already offer a tokenised fund. Of those that don’t, nearly two-thirds again (62%) expect to do so within the next five years. Only 10% say they don’t plan to, with 29% uncertain. This is a strong signal: tokenisation is not just theoretical, it is happening now, and even the holdouts largely expect to join in.
Why would managers without tokenised funds consider launching them? The survey findings are revealing. Over half (52%) said the main driver would be potential investor demand, compared to only one-third (33%) citing demand from existing investors or distributors.
This suggests managers view tokenisation as an opportunity to grow their investor pool, particularly among younger and digitally native audiences, rather than simply a way to service current clients. Nearly half (48%) also cited anticipation of appetite for new distribution models and asset classes, further underlining tokenisation’s perceived role as a growth strategy.
When it comes to criteria for choosing a platform, non-adopters again show their caution. Cyber security resilience leads (48%), followed by regulatory compliance (38%). Integrated solutions — such as platforms that combine tokenisation with fund administration, custody, and depositary controls — scored 29%. Cost, however, trailed at a distant 14%. As with asset owners, the message is clear: safety and compliance trump price.
Looking forward, 93% of asset managers expect tokenised funds to become more widespread in Europe over the next five years. More than half (51%) predict they will become “greatly” more widespread, while 42% say “to some extent.” Tokenisation may not be universally embraced today, but it is widely viewed as an inevitability.
Those Who Offer vs. Those Who Don’t: A Tale of Two Perspectives
A closer look at the differences between asset managers who already offer tokenised funds and those who don’t reveals subtle but important contrasts.
On expectations, the gap is small but notable. Among those already offering tokenised funds, 53% believe tokenised funds will become greatly widespread, compared to 48% among those who don’t.
More tellingly, all current providers expect tokenisation to grow, versus just 81% of non-providers. A small minority (14%) of non-providers admitted they simply “don’t know” what to expect – underlining the knowledge gap between participants and observers.
The divergence is sharper when it comes to criteria for choosing service providers. Those already offering tokenised funds prioritise financial strength (56%), regulatory compliance (53%) and cyber security (50%) almost equally. Those who don’t, however, place much greater emphasis on compliance (71%), with financial strength and security both lower (48%).
In other words, incumbents appear more balanced in their priorities, while non-adopters are fixated on compliance – perhaps reflecting the fears and uncertainties of entering a new space.
Interestingly, non-adopters also value track record (52%) far more than adopters (24%). For those inside the market, building that track record is part of the journey; for outsiders, it is a prerequisite.
Another divergence comes in custody preferences. Providers are evenly split: 50% prefer a trusted third-party custodian with separate execution, while 47% prefer an exchange that combines execution with custody.
Non-providers, by contrast, lean heavily towards the third-party model (52%) and are far less open to exchange solutions (19%). Strikingly, 14% of non-providers chose “neither” and another 14% “don’t know,” compared to virtually none of the current adopters. Again, perception diverges from practice.
When asked about blockchain preferences, current providers lean strongly towards private blockchains (59%), while non-providers are less decisive (43%). Nearly a third of non-providers (29%) reported no preference at all, compared to just 15% of adopters. Those in the market know what they want; those outside are still feeling their way.
Finally, strategy provides perhaps the clearest dividing line. All providers have either a comprehensive (59%) or developing (41%) strategy for managing DLT procurement. Among non-providers, fewer than two-thirds (62%) have such a strategy, with 14% admitting they have none and 24% saying they don’t know. Experience breeds clarity; inexperience breeds hesitation.
The Bigger Picture: Demand Is There, but Caution Reigns
Taken together, the findings paint a picture of an industry in transition. Asset owners are intrigued, asset managers are advancing, and both sides recognise tokenisation’s potential to reshape the industry. Yet enthusiasm is tempered. Demand is “moderate to high” rather than “very high.” Compliance and security concerns loom large. Cost is consistently deprioritised, a sign that institutional investors are willing to pay for the right solutions but won’t rush into unsafe or unregulated waters.
Perhaps most importantly, the survey shows tokenisation is seen less as a reaction to existing demand, and more as a proactive strategy to attract new investors. For asset managers, this is about growth and future relevance. For asset owners, it is about optionality, diversification and security.
The verdict? Tokenisation is no longer a fringe idea, but neither is it yet indispensable. For now, it sits in the middle ground: widely anticipated, moderately demanded, cautiously implemented. The differences between adopters and non-adopters show that the journey from theory to practice brings clarity — and shifts priorities from fear of compliance to optimisation of cost and service.
Over the next five years, the survey suggests tokenisation will move steadily from experiment to expectation. It may not be a market investors are screaming out for today, but it is one they will increasingly come to expect tomorrow.
The Funds Europe-Caceis report into tokenisation can be viewed by following this link.
