Asia-Pacific banks are becoming more comfortable with tokenisation than with cryptocurrency, but that distinction may become harder to sustain as both markets move from pilots to operating infrastructure. The operating rails needed to support tokenised funds, bonds and deposits are closely related to the capabilities banks must confront when deciding whether to offer regulated crypto services. Gerald Goh, co-founder and chief executive officer of Sygnum Asia Pacific, argues that many institutions are misreading the sequence of adoption. Banks no longer need to decide whether digital assets will survive. They need to decide whether to build the infrastructure, governance and client proposition required to participate. Many banks in the region still treat cryptocurrency and real-world asset (RWA) tokenisation as separate strategic choices. That distinction may feel prudent inside a boardroom, but it obscures a central connection. Crypto is where banks learn the operating capabilities that tokenised assets will also require. Regulation has moved faster than bank conviction Regulation sits between strategy and execution. A digital asset initiative cannot move from an innovation team to risk, finance, compliance and product approval unless the institution can explain the asset, the controls and the capital treatment. Clearer regulation does not remove the need for internal judgement, but it weakens the case for waiting. Goh said easing regulatory uncertainty in the United States (US) has shifted the debate from whether institutions can engage with digital assets to how they choose to do so. "The concerns about the US regulatory treatment and acceptance of crypto assets has lifted in a dramatic fashion," he observed. The April 2026 consultation paper by the Monetary Authority of Singapore (MAS) on banks' prudential treatment of cryptoassets on permissionless blockchains sent a more relevant signal for Asia-Pacific banks. The paper did not encourage banks to hold Bitcoin or Ethereum on their balance sheets. Its significance lay in moving the discussion away from judging blockchain labels and towards assessing the underlying asset, the risk and the controls a bank can apply. Blockchain type has often become an internal veto point. A finance, risk or compliance team can block a product by arguing that a public chain creates unacceptable capital, operational or reputational risk, even when the proposed asset resembles a traditional financial instrument. The MAS approach weakens that objection by asking institutions to identify the risk, manage it and justify the treatment, rather than reject the technology by label. Regulatory clarity has not translated automatically into bank action. The remaining barrier sits inside institutions. "What is remaining in terms of friction points fundamentally boils down to the mindset of the decision-makers at these institutions," Goh argued. "Their perception of digital assets and crypto, and how important it is that they activate it today versus sometime down the road." The strategic question is no longer whether regulators will allow engagement, but whether management teams believe digital assets deserve investment, senior sponsorship and commercial targets. Tokenisation feels safer but still needs crypto rails Inside banks, cryptocurrency and tokenised real-world assets sit in different categories. A board may hesitate to offer Bitcoin or Ethereum to clients because it worries about volatility, investor protection, reputational risk and questions over intrinsic value, while the same board may approve work on tokenised funds, bonds or deposits because those instruments look like familiar financial products placed on new rails. Goh recognised that distinction and did not dismiss it. "Banks make the distinction between digital assets and cryptocurrencies," he said, noting that the distinction often reflects concerns around regulation, investor protection and reputational risk. Tokenised real-world assets are easier to explain internally because the asset itself remains familiar, which helps explain participation in initiatives such as Project Guardian, the MAS-led programme for institutional tokenisation trials. Tokenised assets, he said, are "easier to understand, but also easier to pass your internal compliance and risk committees." The risk is that this safer route delays the infrastructure that tokenisation needs. A bank can run a pilot on a controlled platform without giving clients real wallet access, enabling transfers across institutions or connecting to wider liquidity pools. That may be sufficient for experimentation, but it does not create a scalable market. If tokenisation is to improve access, transferability and settlement, banks must build operating capabilities that institutions already offering crypto services are learning to manage. The tokenisation race is stuck at distribution Tokenisation has moved beyond the conceptual stage, but it has not solved its commercial bottleneck. Banks and regulators across Asia-Pacific have tested blockchain-based versions of funds, bonds and alternative investments, but commercial adoption remains limited. Even when the token exists, distribution still depends on platforms, ownership records, custody, settlement and approved investor access. "These things are leaving the lab now," Goh said. "Where most people are stuck is distribution." Distribution, not issuance, determines whether tokenisation becomes a banking business rather than an innovation exercise. Most tokenised products can only circulate inside the issuing institution's existing client base because regulated wallet infrastructure does not exist at scale across banks, brokers and investors. A client of one bank cannot easily send a tokenised security to a client of another bank, and a tokenised fund cannot automatically access the kind of global, continuous liquidity that digital asset markets have demonstrated. Swift, the global bank messaging network, is working on similar interoperability questions. Its work points to the same challenge. The harder task is not creating tokenised value, but connecting it safely into existing payment, compliance and liquidity systems. As Goh noted, "the last mile issue on infrastructure is a real thing", and tokenisation cannot solve distribution until regulated wallets and liquidity venues become more connected. The MAS consultation paper also matters beyond the balance sheet question. A risk-based approach reduces the pressure on banks to use only closed or permissioned chains, which can limit interoperability when each institution builds on a different proprietary system. Treating public and private protocols according to risk, rather than label, could reduce internal resistance and improve the conditions for regulated institutions to connect, transfer and settle tokenised assets across platforms. Crypto infrastructure prepares banks for tokenised finance The connection between crypto and tokenisation becomes clearer when viewed through infrastructure rather than product categories. "Crypto is really the proof of concept for tokenisation," he said. "The people who get it, both in terms of mindset but also those that bother to set up the necessary infrastructure, like a wallet, for themselves to trade crypto, will also be the best positioned to be early adopters of RWA tokens." That point gives banks a practical warning. Crypto adoption is not only a product decision. It is also an infrastructure rehearsal. A bank that offers regulated crypto custody, trading and wallet access learns how to manage private keys, on-chain compliance, client transfers, asset segregation, anti-money laundering (AML) and know your customer (KYC) controls, and integration with fiat rails. As Goh put it, "when you think about why people use banks, fundamentally it is because they trust banks more than other financial institutions because they know they are the most well-regulated." That trust matters when digital assets need to move back into the banking system. Periods of market stress have reinforced the value of regulated custody, particularly for clients who need recognised AML, KYC and fiat banking rails. For large digital asset portfolios, Goh said, "the certainty of obtaining fiat liquidity is far higher when your digital assets are custodied at a bank versus a non-bank." The same custody and settlement discipline will matter when tokenised funds, securities and deposits move from pilots into broader client distribution. A bank that defers crypto may believe it has preserved optionality, but it may have delayed the build that determines whether it can compete later. Tokenisation will not scale through presentations, closed pilots or internal book entries alone. If the bank holds the wallet and the client sees only an internal book-keeping record, the model remains a controlled internal arrangement rather than a genuinely interoperable market infrastructure. That does not solve distribution until clients and institutions can use real wallets within a regulated framework. Asia-Pacific banks need to turn pilots into operating capability Asia-Pacific banks do not need another round of isolated proofs of concept. Global experiments such as Project Agorá, led by the Bank for International Settlements (BIS), show that tokenisation is moving into bank money, cross-border settlement and operational controls, not just capital markets products. The infrastructure question is expanding from tokenised securities to tokenised deposits, central bank reserves and real-time settlement. Banks need to decide who owns the digital asset agenda across risk, product, technology and distribution, and whether crypto infrastructure belongs in the same roadmap as tokenisation. A workable operating model should connect board mandate, risk appetite, client proposition, wallet access, regulated custody, fiat settlement and partner selection. Real-world asset tokenisation remains at an earlier stage of commercial adoption than cryptocurrency. The priority is to assign ownership across risk, product, technology and distribution, then determine how crypto and tokenisation fit into one infrastructure roadmap.
