BlackRock CEO Larry Fink likens asset tokenization (RWA) to “the internet in 1996.” This statement can be seen as the awakening of traditional finance in the crypto era.

His point is that crypto finance is a new financial infrastructure with great potential, but still in its early stages, just like the internet in 1996, when most people did not realize it would fundamentally change the existing landscape. In 1996, people still read magazines/newspapers/listened to radio/watch TV. Now, newspapers and magazines are rarely read; instead, online news/social media/live streaming/videos dominate.

Look at the internet in 1996:

• Most people were still using dial-up (56K modem), with snail-paced speeds;
• Slow internet, ugly websites, little content, and ordinary people thought “online browsing isn’t useful”;
• Amazon was just one year old, eBay had just launched, and Google wouldn’t be born for another two years;
• Professionals and geeks were frantically building, but Wall Street and traditional companies were basically laughing at “the internet being just a toy”;
• Infrastructure (broadband/fiber/data centers/browsers) was not fully ready yet;

However, visionaries at the time were already sounding the alarm: “This thing will reshape all industries.”

Now, look at the current “asset tokenization” landscape:

• Ethereum and Layer 2 ecosystems, Solana, etc., have preliminarily built the infrastructure capable of supporting tokenization.

Today, real assets like stocks, bonds, funds, private equity, stablecoins, gold, real estate, etc., can be tokenized on-chain into crypto tokens. However, issues like chain TPS, cost, privacy, security, compliance, custody, and regulation still need to be fully addressed. These challenges are similar to the situation in 1996. But from the perspective of Ethereum’s evolution and infrastructure, the current situation is somewhat better than in 1996.

• The market size is very small, but the growth rate is beginning to accelerate.

By 2025, the total RWA market size will only be a few hundred billion dollars, while global investable assets total over $400 trillion. RWA assets account for less than 1% of that, so the scale is small. However, over the past two years, with institutional participation, the growth has started to pick up.

• Many traditional financial institutions are still watching or mocking.

Some banks/institutions still say “blockchain is just for speculation,” or “tokenization is unsafe.”

This is similar to the early days when people said the internet was just a toy, and traditional retailers ridiculed Amazon's online sales as illogical.

• A few top players have already gone all-in.

Even if some banks and institutions are uninterested, forward-looking players like BlackRock have entered the space. In 2024, BlackRock launched the Ethereum-based USD money market fund BUIDL, which has been growing steadily; Goldman Sachs, Fidelity, Societe Generale, and others are exploring tokenized bonds, funds, and even real estate. Is this similar to the early attempts of internet startups from 1996-1998?

Besides traditional players, more crypto-focused entrepreneurs and startups will become the future protagonists, like AAVE, Uniswap, Hyperliquid, Lighter, Polymarket, etc. Some may be replaced by later entrants, and many new players are still on the way. The next 5-10 years could be another golden era for crypto entrepreneurship.

If this trend proves correct:

Then, in about 5-15 years, full asset tokenization will be achieved, starting with the most liquid assets like stablecoins. Currently, stablecoins have become successful examples of asset tokenization. Next will come stocks, bonds, funds, music copyrights, carbon emission rights, etc., and finally the most challenging assets like gold and real estate—enabling 24/7 instant trading, global circulation, and second-level settlement.

In five years, transaction costs will decrease to acceptable levels thanks to the significant improvements in blockchain infrastructure like Ethereum, coupled with advances in privacy tech and compliant regulation, making asset trading and circulation increasingly feasible.

Retail investors might be able to buy one-ten-thousandth of a Manhattan office building within 10-15 years; all financial products could become programmable “smart assets,” automatically balancing management, dividend distribution, re-investment, collateral triggers, etc.

In summary, current tokenization may seem unreliable, but just like the internet in 1996—barren and toy-like—it now fulfills almost all the original visions. The next 5-15 years will be the best era for crypto-financial startups.