Digital assets and tokenisation in Asia Pacific are entering a more focused and institutionally grounded phase, as pilots and sandbox initiatives give way to closer observation of how tokenised instruments behave under early live operational and supervisory conditions. Across Singapore, Hong Kong and Japan, regulators are increasingly focusing on how tokenised products can be deployed safely, rather than simply whether they are technically feasible. Initiatives such as Monetary Authority of Singapore’s Project Guardian and the Hong Kong Monetary Authority’s Project Ensemble are providing controlled environments to examine settlement behaviour, interoperability and supervisory oversight in multi-chain settings. Against this backdrop, Yvonne Ng, vice president for Asia Pacific at blockchain intelligence and risk management firm Elliptic, discusses where institutional tokenisation is gaining traction, why identity assurance and cross chain visibility are becoming foundational, and how risk capabilities are evolving as banks prepare for more sustained engagement with tokenised markets. Where institutional tokenisation is taking shape According to Ng, institutional momentum is most visible in tokenised deposits, bonds and money market funds. These instruments, she argues, align closely with existing banking workflows, which lowers the operational barriers to moving beyond experimentation. “Institutions deploy real capital and operational effort because the demand is tangible. We’re seeing regions in Asia Pacific leading the charge,” she said. Hong Kong’s Project Ensemble, launched in 2024, has since progressed into EnsembleTX, a real-value pilot phase introduced in late 2025 to move beyond sandbox testing. The initiative is expected to run through 2026 as regulators and banks assess settlement behaviour and risk controls under closely supervised live conditions. In Singapore, Project Guardian — initiated in 2022 — continues to expand its scope across fixed income and funds, with an emphasis on identifying viable commercial pathways. “Major banks are committing resources to these areas with the knowledge that efficiency gains in settlement and liquidity management are within reach,” Ng explained. Divergent approaches across APAC Ng discussed the differences in approaches between markets in Asia Pacific. Hong Kong, she argues, has seen strong momentum through structured pilots focused on tokenised assets and interbank-style settlement. By contrast, Singapore has taken a broader approach, exploring multiple asset classes while emphasising interoperability and commercial pathways. She also cites how Japan is building steadily around regulated stablecoins and real-world assets in a controlled institutional environment. This includes bank-led tokenised deposit initiatives such as DCJPY, involving domestic financial institutions including SBI Shinsei Bank, MUFG Bank, Mizuho Bank and Sumitomo Mitsui Banking Corporation, operating within Japan’s tightly supervised regulatory framework. Despite differences in pace and structure, Ng observes a shared risk based mindset across these markets. “Safeguards are being developed alongside innovation,” she said. “This is driving demand for consistent, real-time blockchain analytics that help institutions easily monitor risk in line with evolving regulations as activity scales across jurisdictions.” Identity, provenance and institutional grade visibility Across these differing approaches, a common requirement is emerging: institutional-grade identity assurance and provenance. Banks are strengthening how they verify counterparties, screen wallets and assess transaction histories across multiple blockchains. “Rather than replacing traditional know-your-customer (KYC), blockchain analytics are being layered on top to add context and confidence to on-chain activity,” Ng said. From Elliptic’s vantage point, blockchain analytics are increasingly being used to translate raw on-chain data into operationally relevant insights for compliance teams. By analysing wallet behaviour and transaction patterns across chains, institutions can monitor risk with greater contextual clarity, even as governance and supervisory frameworks continue to evolve, Ng explained. Settlement efficiency and emerging risk dynamics Tokenised deposits and regulated stablecoins are increasingly being explored as settlement instruments, promising faster settlement and improved liquidity management. At the same time, Ng warned, they introduce new behavioural and flow related risks that institutions are still learning to manage. “Institutions are paying closer attention to how these assets move across platforms, counterparties and chains, particularly as volumes increase,” she said. Monitoring frameworks are being extended beyond formal anti-money-laundering (AML) and counter-financing of terrorism (CFT) obligations to address liquidity and operational risks emerging in tokenised settlement environments. Analytics and monitoring tools, Ng noted, are being used to give institutions greater visibility as settlement behaviour and operational risks shift from theoretical to observable. Regulators in key Asian hubs have also woven AML/CFT and financial-crime prevention directly into digital asset frameworks. In Singapore, MAS’ digital token provider licensing regime incorporates risk-based controls — such as customer due diligence, monitoring and reporting obligations — that mirror traditional AML standards for financial institutions. In Hong Kong, the HKMA and Securities and Futures Commission’s joint guidance and stablecoin supervision guidelines explicitly embed AML/CFT expectations for intermediaries and stablecoin issuers, reinforcing that market integrity and crime prevention are central to tokenised finance regulation rather than ancillary concerns. These regulatory expectations align with global financial-crime standards set by bodies such as the Financial Action Task Force, whose recommendations inform national AML/CFT policy in digital asset markets. Programmability, governance and cross chain exposure Compliance alone is insufficient once systems become programmable and interconnected. As tokenised products become more programmable and interconnected, governance and operational oversight are moving higher up institutional agendas, with cross-chain dependencies and evolving illicit-finance typologies no longer theoretical concerns. Ng points to data suggesting that more than $21 billion in illicit funds moved across chains in 2024 — underscoring the scale of activity institutions are attempting to monitor, particularly during moments where assets transition between chains and visibility gaps can emerge. As multi-chain initiatives such as Project Guardian and Project Ensemble go live, vulnerabilities — including bridge failures, message-passing errors and variations in settlement behaviour between networks — are increasingly observed under real conditions. “Institutions are placing greater emphasis on real-time visibility and understanding how activity moves across chains, rather than assessing risk in isolation,” she said. These visibility requirements are constrained by the need to balance client data privacy with supervisory transparency. Public blockchains offer inherent transparency, but raw data alone does not equate to effective oversight. “The challenge is less about choosing between privacy and transparency, and more about how transparency is delivered responsibly,” Ng said. “We’ve seen institutions increasingly relying on curated blockchain data and intelligence. This allows them to surface patterns, exposure and anomalous behaviour without unnecessarily disclosing customer identities.” For banks operating across multiple jurisdictions, this balance is critical, as AML transparency must coexist with banking secrecy laws, data-protection regimes and long-standing client confidentiality obligations. Evolving crime typologies and analytical demands Cross-chain complexities are reshaping how illicit activity manifests in tokenised environments, particularly as activity becomes more automated and interconnected. Ng observes that illicit behaviour is increasingly embedded within underlying infrastructure rather than appearing as discrete, standalone transactions. Automation, smart-contract-based obfuscation and cross-chain movement are changing how such activity appears on-chain. “This shifts the focus away from isolated transactions and toward understanding broader behavioural and network-level patterns,” Ng said. She described Elliptic’s response as building long-term data capabilities, drawing on more than a decade of labelled activity and cross-chain intelligence, to support institutions as detection and supervision models adapt to complex risk dynamics. Institutional participation and risk positioning As risk visibility and governance demands increase across tokenised markets, financial institutions are positioning themselves accordingly. Elliptic counts major global banks among its backers — with Wells Fargo investing in 2020, JPMorgan Chase joining in 2022, and HSBC announcing a strategic investment in September 2025. In November 2025, HSBC also executed a cross-bank transfer of HKD 3.8 million (about USD 490,000) for Ant International — among the first real-value transactions under EnsembleTX’s pilot phase. For Ng, these investments signal how large financial institutions are positioning themselves to better understand and manage on-chain risk exposure as tokenised activity moves closer to live deployment. She stressed that institutional focus has shifted from speculative exposure to risk management and compliance. Durable value in a hybrid market architecture Over the longer term, Ng envisages tokenised finance operating across a mix of public and permissioned networks, rather than converging on a single dominant model. She stressed that long-term value is likely to accrue to institutions that can provide trust, operational assurance and balance sheet support. “Banks are well positioned to capture durable value through custody, settlement, liquidity provision and balance-sheet support. Acting as trusted bridges between on-chain activity and established financial systems will be a key differentiator,” she said, noting that early investment in understanding and managing on-chain risk will be key to participating more effectively as tokenised market structures continue to take shape. As tokenised activity moves into live environments, the ability to demonstrate control and visibility is increasingly shaping which institutions succeed at scaling participation. Elliptic’s evolving role in applying blockchain analytics to institutional compliance reflects a broader reality: tokenisation is advancing unevenly, and its ability to scale will depend on how effectively risk and governance capabilities keep pace with live activity.
