Episode Description:
Financial market infrastructure is often invisible to investors, yet it powers every trade, settlement, and ownership record across capital markets. As technology evolves, tokenization is emerging as a new way to represent and transfer financial assets, raising questions about how markets may operate in the future.
In this episode of The Bid, Oscar Pulido speaks with Rob Goldstein, Chief Operating Officer at BlackRock. They discuss what tokenization means in practice, how it differs from cryptocurrencies, and why digital assets are drawing increased attention from investors, institutions, and policymakers.
The conversation explores how tokenization could improve access, efficiency, and connectivity across financial markets. Rob also shares his perspective on the coexistence of traditional financial systems and digital assets, the role of digital wallets, and the regulatory developments that could shape adoption in the years ahead.
Key insights:
• How tokenization creates digital representations of financial assets
• Why tokenization differs from cryptocurrencies and Bitcoin
• How digital wallets could expand access to capital markets
• Why traditional finance and digital assets may coexist
• What role blockchain technology plays in financial infrastructure
• How regulation could influence the future of tokenized markets
Keywords: Tokenization, Digital assets, Financial market infrastructure, Capital markets, Blockchain technology, Digital wallets, Investing innovation, Financial technology
This content is for informational purposes only and is not an offer or a solicitation. Reliance upon information in this material is at the sole discretion of the listener. Reference to any company or investment strategy mentioned is for illustrative purposes only and not investment advice. In the UK and non-European Economic Area countries, this is authorized and regulated by the Financial Conduct Authority. In the European Economic Area, this is authorized and regulated by the Netherlands Authority for the Financial Markets. For full disclosures, visit blackrock.com/corporate/compliance/bid-disclosures.
Oscar Pulido: Most investors spend a lot of time thinking about what to invest in, whether stocks, bonds, themes, or sectors, but very few think about how those investments actually move through the system. Behind every trade, there's a complex web of infrastructure, systems that record ownership, settle transactions, and keep markets functioning. And for the most part, that system hasn't changed all that much. But now that may be starting to shift.
Tokenization is challenging how financial markets are built at their core, not by changing what people invest in, but by changing how those assets are issued, traded, and tracked. And that shift raises a bigger question: If the underlying infrastructure of markets evolves, what does that mean for investors?
Welcome to The Bid, where we break down what's happening in the markets and explore the forces changing the economy and finance. I'm Oscar Pulido.
Today, I'm joined by Rob Goldstein, chief operating officer at BlackRock. We'll discuss what tokenization actually means in the context of financial markets, how it differs from crypto, and what it could take to build a more connected digital financial system
Rob, thank you so much for joining us on The Bid.
Rob Goldstein: My pleasure. I'm excited to be back, and I think we have a whole lot to talk about.
Oscar Pulido: Rob, for the true aficionados of The Bid who are listening, they know the fun fact that you were the original guest on the first episode of The Bid back in 2018.
Rob Goldstein: Although I don't feel like you have me back a lot!
Oscar Pulido: We have you back when it's a really important topic!
Rob Goldstein: Ha, got it.
Oscar Pulido: And in that first episode, you talked a lot about technology, and I went back and listened to that first episode, even though I wasn't the host quite yet. I came on a few episodes later. But one of the things that you talked about is that investing was becoming a technology business, and I don't think anybody would've really argued with you back then, but certainly nobody would argue with you now. And today's topic is tokenization, which is certainly talking about technology and investing, but perhaps we can start with that term. I think when people hear that term, it means a lot of different things. What does it mean in the context of financial markets?
Rob Goldstein: Yeah. And I think if we go back to the first, episode of 'The Bid,' even if we go back before then, so much of what we've done at BlackRock has been recognizing that, to a large degree, the investment management business is an information processing business. And as you think about it through that lens, there's been a lot of different technologies, and what these technologies typically do is, in some way, they reduce friction in a way that makes market access actually easier, better, faster, cheaper.
You could think about the mutual fund was a technology, we spoke about the ETF being a technology several times, and the token is just another technology. The token is a concept that effectively lets you have a representation of a stock, a bond, a fund, your house, whatever it may be, as a digital certificate that could be held in a wallet.
And it's very interesting because, my daughter just graduated college, and I coordinated the rent situation for the house she was living in. And we did it through Venmo. When I went to college, if I would've told you, you would have a device you hold in your hand that you do 92 other things and you stare at for, 12 hours a day, that there would be a device on your hand, and you would touch it And there was an app that let you just move money around. So, the other parents would send me the Venmo rent, and then I would pay people with Venmo. That whole concept would've seemed insane 32 years ago when I graduated college.
And if you think about it now, why can't you do the same basic concepts with regard to stocks, bonds, funds, and other things? That is the basic premise of a token. You have a wallet, you have representations of exposures, and you have the ability to move them in a way that's compliant, but importantly, in a way that's instantaneous and frictionless.
Oscar Pulido: And you mentioned also another important word, which was 'access', and I think what you're saying is that tokenization, gives investors more access to capital markets. At least that's a direction that we're headed in.
Rob Goldstein: Tokenization, in theory, not only gives more access, but I think you have to look at it through a global lens. So, obviously, when you sit in the U.S., you have one perspective. But if you look at it through the lens, for example, if you're sitting in India, you're sitting in Brazil, you're even sitting in China, the whole concept of access to these services is a very different concept. And your primary equalizer, no matter where you are anywhere in the world at this point in time, is that you have a phone.
And that phone is the interface for many things in your life, but one of the things it's certainly the interface for is the ability to manage payments, money, wealth. And I think over time, it's very hard to argue that direction won't continue. One of the favorite things that, we had in a strategy session among BlackRock's global executive committee, this was maybe three, four months ago. We were having a rigorous debate about this topic of tokenization. It's amazing because many people immediately gravitate towards this being binary. They gravitate towards tokenization is going to make the old capital markets be obsolete, or the old capital markets are so embedded that tokenization will never come to fruition.
The truth is, if half a percent every year for the next 10 years migrates to tokens, that is a gigantic number, and that is a number that people can't ignore. So, we're having this rigorous debate, At the time, I think there were $4 trillion in digital wallets, was the estimate globally. I said, 'Raise your hand if you think 4 trillion in the year 2030 will be more.' Every single person raised their hand. And then I said, 'Raise your hand if you believe 4 trillion will be at least 8 trillion by 2030.' Most people raised their hands. So, if you believe either of those statements are at all directionally plausible, you can't not pay attention to the technology of tokenization as another access vehicle
Oscar Pulido: I want to talk more about how tokenization and what I'll call the traditional finance system are going to coexist, but before we do that, if you were to take people under the hood of that traditional finance system and look to see actually how it works, what would people be surprised to learn about the more traditional way in which capital markets work, and what is tokenization then trying to improve upon?
Rob Goldstein: and I think through one lens, people would be surprised about everything, and I think through another lens, people would be surprised with the complexity. And when I say surprised about everything, if you're someone who's very sort of tech curious, and you go to the airport or at your doctor's office, wherever, and you really pay attention to how people are using technology, there's a lot of steps in the process. And I think with regard to finance and the traditional capital markets, there are a lot of steps in the process.
Now, let me be clear, the traditional capital markets are a highly efficient digitized ecosystem. Finance has been at the forefront of technology for a very long time. The volumes are tremendous. It's very global. So, finance has been highly digitized for quite some time. I think when people look at them coexisting, you’ve got to look at it through a slightly different lens. They may coexist, but they may be a little more distinct as you get to the individual level.
So, for example, my mom, I don't think is going to have a digital wallet anytime soon. That said, my kids may want everything in a digital wallet. One of the things that someone asked me, they, they said it would be a great idea you guys should analyze as these frontier AI companies are raising capital, some of that capital is to provide liquidity to employees. As these employees are getting these tremendous sums of money, and obviously the average age of the employee is younger than us -two old farts- what percent of that money is going into digital wallets? They said that would be a great thing for you guys to analyze. I agree with that. I have no idea how someone would do that, but I think it's fair to say that it's greater than zero. And when you look at the bifurcation, part of it is age, part of it is tech fluency, part of it is starting point.
Do you have an account at Schwab yet, or do you have an account at Coinbase? And depending upon where you have your account, you may not want to start a second account. That bifurcation and coexistence may be a little more individualized. Simultaneous with that, I also believe that this bridging strategy, one of the things that has been proven, and I think BlackRock has played an important role here.
So, if you think about it, our whole strategy has been how do you bridge the capital markets with this alternate universe of digital assets? That bridging strategy between the two, I think has been very important. I think what we're going to see is these environments coexist. There will be more and more bridging strategies where people will try to extract the value proposition, while at the same time certain individuals are going to prefer to be within a digital wallet, and certain individuals are going to prefer to be within a traditional capital markets ecosystem.
One thing that I find, quite remarkable is the whole narrative of tokens and the whole narrative of digital assets, if you go back five years ago, seven years ago, maybe even three, four years ago, the narrative was the capital markets are broken, and this is the new way. Now, the narrative is much more they each provide a value proposition, and depending upon who you are, where you are, and what you're trying to accomplish, one or the other or a combination of the two is the best way to optimize.
Oscar Pulido: And I think one of the examples of this bridge between tokenization and the capital markets, y- you mentioned Bitcoin and the ability to invest in it via an exchange traded fund, is one of those bridges in action. and that reminds me that we recently spoke to Robbie Mitchnick, who's head of digital assets at BlackRock, and Dan Morehead, who's the CEO of Pantera Capital, who invested in Bitcoin many years ago before it was a popular topic.
Oftentimes, when we talk about tokenization and crypto, they get lumped together as potentially one and the same thing. They're obviously very different, but the reason they get grouped together is because of the blockchain technology that supports both of them. So perhaps you can talk a little bit more about the difference between crypto and tokenization and why this distinction is important.
Rob Goldstein: This is where you have to look at it through the lens of technology. So, there are these exposure vehicles that you have on chain like Bitcoin, and we could argue the value proposition of Bitcoin ad nauseam, but I think it's clear at this point that there's a large enough community that views Bitcoin as having a strong utility, and increasingly a strong utility in a whole portfolio context, that let's put that to the side.
There's a series of technologies that enable Bitcoin that also enable the ability to tokenize whatever you could imagine. You could tokenize oil, you could tokenize oil in the ground, you could tokenize gold, you could tokenize this table, but you could also tokenize things that people have grown accustomed to using as important utilities, whether it be tokenizing cash through something like a stablecoin or ultimately tokenizing a fund or an exposure vehicle.
So, I think that, again, subject to a regulatory environment that enables it, but people are going to want to and will be successful building that whole portfolio, stocks, bonds, and likely digital assets as tokens on a blockchain within a digital wallet. That is certainly the direction of travel. I think we could argue again is that $4 trillion, $8 trillion, $4.5 trillion, but I think it's high conviction more than what it is today, and the amounts of money are so large that it's very hard to not be part of it. It's also, I think, important if you believe in the democratization of the capital markets, this is likely one of the best tools to enable that, both within the United States and more broadly.
Oscar Pulido: And it goes back to access, because I think if democratization of capital markets happens, then presumably that means more people have an ability to invest their savings in different asset classes and invest for the long term.
Rob Goldstein: It goes back to access, it goes back to convenience, it goes back to a value proposition, and importantly, it goes back to your phone. And I think there's a real question that could be, when you have me back in seven years again, eight years again, there's a real question, if you think about your phone in the year 2030, do you have more or less apps on the phone? I think if you believe you'll have less, then that means the apps you have are going to have to do more things. And if you believe that the apps you have are going to have to do more things, there will be an app that will be the ability to move money around, to do investments, to build portfolios. And I think the token and blockchain and the related technologies are important enablers in being able to do that.
Whether or not you even know that you just bought a token of a fund or you just bought a token of a stock, whether or not you as the consumer know that, that's effectively what will enable that fewer app environment that we're describing.
Oscar Pulido: Rob, you and Larry Fink, who's the CEO of BlackRock, wrote an op-ed in 'The Economist' about this topic of tokenization, and you alluded to the fact that when Larry started his career, this was the 1970s, and it was very manual in terms of the settlement of securities when you bought and sold. and then you talk about this topic of tokenization, and I think even, the senior leadership of BlackRock has overcome some early skepticism of this trend and the direction it's going.
But talk a little bit more about some of the themes in that op-ed, the global nature of this theme and the continuation of this bridge between traditional finance tokens.
Rob Goldstein: As a starting point, I was poking on how much older Larry is than me, Rob Kapito for many years would tell a joke that he's so old, he's seen the 30-year Treasury bond mature. Now that I've worked here for 32 years, I don't find that joke funny anymore, 'cause I've seen the 30-year Treasury bond mature. But importantly, even when I started in the mid-'90s, you’ve got to put yourself in those shoes. The cell phone as something you carried like a suitcase was a key innovation. A lot of people didn't have computers on their desks in the financial ecosystem. And the way trading was done was largely paper based. People would fill out paper trade tickets. So, things can change quite dramatically in a way that makes it unimaginable for people to think that's how it was done 10 years ago, 20 years ago, 30 years ago.
And so much of what we're doing at BlackRock is because we've seen the path, there's no fighting these technologies that provide a better, faster, cheaper, more transparent value proposition. And that is fundamentally what we believe.
Technology could complement what you're doing today, and that is what we believe is going to happen. If I had more time, I would love to study this, but I think you could make a very strong argument that a key unlock with regard to digital assets, even with regard to the usage of something like Bitcoin, was actually the fact that it went from, ' We're going to topple the establishment,' to, 'How can we create a force multiplier between the capital markets and this alternate universe, and this alternate universe and the capital markets?'
And once it was more collaborative, and how do we create a force multiplier together, I think that was a key unlock. And I think with regard to tokenization, it's going to be something very similar. If there was a new asset class invented, trading chips, which sounds like an asset class that will exist in our careers.
So, if you're going to trade chips, mem-memory chips, GPUs, TPUs, whatever it is, you could imagine that if you were starting from scratch, you wouldn't say, 'What is the existing ecosystem and how do I plumb this through it?' Versus, 'I'm starting from scratch. What's the best way of doing this, and how do I make that available to people?'
Oscar Pulido: And Rob, you've given the example of cryptocurrencies, and Bitcoin in particular, being available through a more traditional, financial instrument like the ETF. And then you gave the example of how a more traditional financial instrument being available in a tokenized format, which says a lot about the evolution of the industry.
But what does it tell you about the adoption of digital assets in investor portfolios and where investors are starting to see real benefit from this?
Rob Goldstein: First, the adoption of digital assets in investor portfolios is still very small. Relative to what the ultimate opportunity is, it's still very small. And I think more and more what's happening in the world is it's getting harder and harder to create diversification. And the more degrees of freedom you have to do that, the better off you are.
The volatility, that's something many of the digital assets exposures can provide, can play an important role in the right amounts within portfolios, and it provides another ability to effectively optimize a portfolio. And we're seeing more and more clients institutionally, model providers, wealth managers, investing their energy in helping clients understand that. So, I still think it's quite early on the curve, but at the same time, I think that the more people understand it, the more usage will increase, not decrease.
Oscar Pulido: And if you were to look out from here, Rob, the trends around tokenization. for tokenization to be successful, what does that look like, and what has to happen from now t- for us to get there?
Rob Goldstein: Taking two steps back, I think for tokenization to be successful, it's all about two things. One, what is the amount of money in digital wallets- does it go up, and how much? And two, is whether or not you have access to tokenized capital markets instruments so people could build smart long-term portfolios through tokens in wallets. I don't think it would be healthy if the only tokens you have access to are only digital assets.
You're going to need a broader solution set. You're going to need more degrees of freedom. And assuming those two things happen, I think it will be successful if you look at it through a global lens. I think for it really to be successful, and I think for it to be successful in the United States, you need more clarity, of regulation, and you need people to have comfort, confidence, sponsorship, that we have a long-term regime as to how this is going to work, that people could then invest their time and their resources into plumbing around.
Oscar Pulido: And I think when people hear this, Rob, some of the terminology is very new, and it's not how they're used to investing. It's not how their portfolio is invested or how they access capital markets. But I go back to that first episode of you in 2018, and a lot of what you said has played out over many years, and so people should pay attention to some of the trends that you're looking at.
Rob Goldstein: Yeah, and I also believe people shouldn't overdo it, and what I mean by that is, I would argue most people have no idea about the detailed plumbing that goes into buying or selling a stock. Or buying or selling an ETF. for those who do want to have access to it, the good news is there's never been more transparency, information, so on and so forth.
So, you could become an expert but presumably, these technologies are about enabling an outcome, not requiring you to be a hobbyist or an expert in what we're talking about. So, I think it's really important that if you need to understand all of this, it inherently has already failed. What you should understand is you have a better value proposition. It's cheaper, it's faster, you have more transparency, and that app on your phone lets you do more things in a really simple way.
Oscar Pulido: I think that's a great point. Most people watch TV, they're not concerned with how the TV works and all the wiring, but they are more concerned with the quality of the picture and just the content that's coming across.
So, Rob, when you first walked into, BlackRock in 1994, I wrote down a few things that you were saying throughout the conversation, which was 'on chain', 'Bitcoin', crypto, digital assets. I can't imagine that 1994 Rob Goldstein would have imagined saying those terms in 2026, but I guess it just goes to show things are evolving, they evolve quickly, and they'll continue to evolve.
Rob Goldstein: And I think that what I've learned is the obvious stuff wins, and the obvious stuff is often leveraging technology and things just getting better, faster, cheaper. If you believe in the technology element of this, it'll just continue to evolve and develop and become more important over time.
Oscar Pulido: Rob, you've also heard the term, quality over quantity, that's how we think about your appearances on The Bid.
Rob Goldstein: That was a good save. They’re always smart!
Oscar Pulido: They're always very prescient in terms of what's coming, especially in the intersection of investing and technology. thanks for sharing your time with us. Thanks for doing it here on The Bid.
Rob Goldstein: My pleasure. Thanks for having me.
Oscar Pulido: Thanks for listening to this episode of The Bid. If you enjoyed the show and want to support the podcast, consider telling your friends about us or sharing an episode that really resonated with you. Make sure to subscribe to The Bid and follow us on social media so you never miss an episode.
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