Welcome back to Market Movers.
The opening bell.
One of the early signs that tokenization was going mainstream, was its role in moving US government debt, securities on chain.
The tokenized Treasury markets surpassed $10 billion this month, and despite this tokenized Treasuries remain rigid or firm in their structure, and they have limited flexibility beyond blockchain enhanced transfers.
But efforts are underway to enhance their liquidity, interoperability, as well as programmability. which would make them more dynamic.
Well joining me on this Friday morning here at the New York Stock Exchange is Gerald David, CEO of Link.
JD, great to have you here.
Thank you so much for joining me.
Hi, great to be with you today.
Thanks for having me on.
So for our viewing audience who may not be familiar with tokenized treasuries, give us an idea of where we are currently at in Q1 2026.
Yes, well, Q1 2026, I think, was a really important moment for us in the tokenization space.
We surpassed $10 billion of.
Of assets now that have been tokenized from the US Treasury space, which I think is critically important, and I think it's amazing to look back at that.
The first share of a Treasury fund was actually tokenized on July 6, 2020 and it was tokenized by a company called ARCA, and we led that effort and it was pretty amazing for us to look back now and look and see that some just 5 or 6 years now in the making, over $10 billion of tokenized Treasury shares have been tokenized, put on chain, and being used for the use cases that we thought they'd be used for originally.
And of course I do want to ask you about demand here.
So give us an idea of what we can expect as we head into the rest of this year.
Yeah, well, I think that you know demand for tokenization services clearly is now and the time it's happening, and there are many, many companies, as you know, entering the space and doing so.
The great part about what I think is happening in this space right now is the adoption of US tokenized treasures and using those for the use cases that one set out to use them for early on. is an investment vehicle traditionally is what people are using them for, right, but the tokenization element, the movement on a public blockchain, allows for a treasury, a tokenized treasury to be used for margin or use for collateral, for treasury management, for all the different elements right now that they are used in the traditional world, but now with the elements, the enhancements that blockchain offers.
Yes, so speaking of blockchain, tell us about the underpinnings of this and what we can also expect as we continue to monitor both regulation and innovation.
Yeah, I think that innovation and regulation are coming together right now, right?
And I think that with regulation almost 85% or so of the way clear, it's now time for the innovators that are out there to build, and I think that some of the projects that are really Really great, including the one that we're working on at Lin allows for a do it-yourself solution.
It allows for a proven technology to allow for the movement of tokenization tokenized treasuries on one platform for those use cases I mentioned before, to collateralize an exchange position, to settle a transaction, to manage real-time treasury, all with interest being generated in real time and delivered down to the two second block.
And I'm sure you speak to many stakeholders out there.
So for the retail investor watching right now and wondering why are institutions currently shifting toward off exchange collateral.
What would you tell them?
Yes, I think that you know for retail investors of exchange collateral is a really, really important part.
I think about exchanges.
I think what we're.
Right now, and really what are the exchanges meant for?
They're meant to manage risk and by holding collateral on exchanges with the hacks that we've seen happen over the course of the past decade or so, I think that it's a very clear signal that off exchange collateral is the ideal place for where institutional clients, retail clients, and others should be holding their assets.
And given your workout link and your leadership, what do you see on the horizon beyond 2026?
Yeah, well, I mean, I think that 2026 is going to be a pivotal year for us.
I think that now that regulation is clear in the US, now that folks are innovating and building, I think you're going to start seeing real products delivered, and I think you're going to see things like tokenized treasury is a great example of being implemented into traditional workflows.
I'm sitting here at the NSE right?
It's Amazing.
I think about the derivatives complex they have.
Can you imagine a scenario in a world whereby one can take a tokenized treasury and you can deliver it to your FCM or your clearing member?
They could recognize that as good collateral.
You could do that within seconds and then it could be in the exchange clearing house again within seconds as well.
It's all about risk management right now and the actual implementation of the use cases that we've been working on that others have been working on for the past decade or more are now coming into realization.
Yes, and JD, finally, before I let you go, what is the next phase after this $10 billion tipping point?
Yes, well, I think that the next phase is, you know, broader adoption, right?
It's using actual tokenized treasuries through implementations like the one we're building at Lin and allowing.
Clients to go ahead and have real-time access to those treasuries, use them to satisfy the use cases they're building, and actually be able to recognize the real benefits that exist through tokenization and through treasuries.
Well, JD, it was great talking to you.
Thank you so much for joining us today and thank you so much for sharing all of your insights.
Thanks for having us on the show.
Thank you.
