TLDR
- Bitcoin price fluctuations no longer dictate institutional interest in tokenization, according to Galaxy’s Thomas Cowan.
- Tokenization is becoming independent of Bitcoin price, with blockchain gaining traction in traditional financial assets.
- Cowan highlights that traditional financial institutions now see blockchain as a long-term, transformative technology.
- The easing of cryptocurrency regulations by the Trump administration has spurred increased institutional interest in tokenization.
- Stablecoins and tokenized money market funds are emerging as key use cases for institutional investors in blockchain technology.
The price fluctuations of Bitcoin (BTC) are no longer the primary factor influencing institutional interest in blockchain technology, including tokenization. According to Thomas Cowan, head of tokenization at Galaxy, interest in tokenization is now independent of Bitcoin price movements. Speaking at The Bridge conference in New York City, Cowan explained that institutions are increasingly focused on the utility of blockchain for traditional financial assets, regardless of Bitcoin’s price.
Separation of Tokenization and Bitcoin Price
Cowan emphasized that in previous years, as Bitcoin and other altcoins surged, interest in tokenization also surged. Traditional financial institutions built out their crypto and tokenization teams during price rallies. However, when Bitcoin prices crashed, these teams shrank significantly, often due to waning interest.
Now, Cowan sees a shift in the market where tokenization development is becoming more self-sustaining.
“The interest in tokenization is now almost independent of Bitcoin price,” he said.
He believes that the growing recognition of blockchain’s potential to move and store financial assets is fueling this shift.
Cowan pointed out that Bitcoin’s volatility no longer defines the future of tokenization, allowing it to stand on its own. Financial institutions are seeing long-term value in blockchain technology, which provides a more efficient way to manage traditional assets.
Tokenization and the Future of Finance
The regulatory environment has also played a key role in the growth of tokenization. With the Trump administration easing regulations on cryptocurrency, institutional interest in tokenized assets has surged. Cowan mentioned that this regulatory shift has encouraged traditional financial companies to engage more seriously in blockchain technology.
He believes that tokenization offers a faster, cheaper, and more secure way to manage financial assets.
“Institutions are starting to see the benefits of blockchain technology beyond Bitcoin,” he noted.
Tokenized bonds and commodities are just the beginning, with many expecting further adoption as more industries explore blockchain’s capabilities.
Cowan also discussed the rising role of stablecoins in institutional finance. Following recent US regulations, stablecoins have seen rapid growth and adoption. According to Cowan, they are an essential step toward wider blockchain integration into traditional finance.
Tokenized money market funds, which invest in low-risk assets like government bonds, are another area gaining traction. Cowan believes that as capital moves on-chain, stablecoins will naturally transition into tokenized money market funds, providing a secure, digital form of capital storage.
