Written by Elliot Henov, Head of Macro Policy Research at State Street Global Advisors. The shift to digitally native financial instruments promises a major transformation whereby raising questions about its rollout and which assets will be tokenised first. Tokenisation could radically change supply and demand dynamics, benefiting specific markets. It offers practical perks such as faster settlements and lower fees, enhancing market transparency and liquidity. However, widespread adoption will be slow due to regulatory and technological hurdles but by lowering entry barriers for issuers and investors, particularly in inefficient markets, tokenisation could spawn new economic models and products. Furthermore, increased asset fungibility might reshape capital allocation and trading, so impacting financial linkages between private and public markets.