Most Tokenized Money Can't Be Sold to a Stranger

Summary: Most of the money in tokenized assets sits in tokens that can only be sent to wallets on an approved list. Pantera Capital counted them in its September State of Tokenization report: whitelisted products held 59 percent of the value in its sample and produced 0.2 percent of the onchain trading in June.

On September 17 the SEC opened a five-year window for blockchain venues to trade tokenized U.S. stocks, and made every one of them run a whitelist. Tokenized funds, where most of the whitelisted money already sits, didn't get in.

Thesis: A token that can only move between approved wallets can't sit in a public market. So it doesn't trade.

The industry has spent this year building quicker exits for those same owners rather than letting new ones in, and the SEC just wrote that model into policy for stocks.

BlackRock's $2.2 billion token has 104 owners

BUIDL is BlackRock's tokenized money market fund, one of the largest tokenized Treasury products anywhere. On October 1 its rwa.xyz page showed $2.25 billion held by 104 wallet addresses. Twenty-seven of them were active in the previous 30 days.

Getting in to the fund is a paperwork process with a token at the end. You need to be a qualified purchaser (for an individual, at least $5 million in investments), and the minimum ticket is $5 million.

Then you'll need to pass identity and anti-money-laundering checks, sign the fund documents, and wait for an email from Securitize, the fund's transfer agent (the firm that keeps the official record of who owns what), saying your wallet has been approved. Then you wire dollars before 2:30 p.m. Eastern and tokens appear.

Getting out runs the same road backward. Send at least $250,000 of tokens to a redemption wallet before 3 p.m. and wait for a wire.

In between, the token lives on nine public blockchains, from Solana to Polygon, and it will only move to wallets on the list. Send it anywhere else and the transfer fails.

The fund does move, and a lot: $745 million over the past month, which Pantera reads as subscriptions, redemptions and collateral shuffling among the approved rather than anyone buying at a market price. That's a lot of traffic for 27 wallets.

So BUIDL is a money market fund whose shareholder register anyone can read on a public blockchain. Getting onto that register still requires permission and a setup that looks like a traditional finance flow.

The list decides whether a token can trade

Pantera sorted 110 tokenized products, each worth at least $10 million at the end of June, by a single question: what happens when you send the token to a stranger?

Open tokens arrive, even when the issuer checked IDs at the moment it created them. Permissioned tokens bounce.

The 51 permissioned products held $16.5 billion. The 59 open ones held $11.5 billion. In June the open group generated $4.8 billion of onchain trading. The permissioned group, holding most of the money, produced 0.2 percent of everything Pantera could see.

The reason is plumbing. A public trading pool is a pot of two tokens that anyone can swap against at a formula price, stocked by people who earn a small fee every time someone trades. A whitelisted token can't go into the pot unless the pot, and every wallet that touches it, is on the list too.

Even when someone arranges that, the fees have to pay people to leave their money sitting there, and a token that changes hands a few times a month pays almost nothing. So the money that would make trading easy never shows up.

Pantera put a price on that. Selling $10 million of tokenized Treasury fund shares through the visible onchain market, without swamping it, would take about 126 days. The same sale in tokenized stocks takes half a day.

And the slow category is where the gates are. Eighty-one percent of the tokenized government-debt value in the sample is permissioned, against 8 percent of tokenized stocks, which means roughly four-fifths of all the gated money sits in one kind of product. For that money, the exit that actually works is the issuer's redemption desk.

Every fix this year is a faster door for the same people

The holders know this, and the money spent this year has gone into making that desk quicker.

In February, Uniswap Labs and Securitize let BUIDL holders trade through UniswapX. Despite the Uniswap name, it works less like a public pool and more like ringing a short list of approved trading firms for a quote (Flowdesk, Tokka Labs and Wintermute among them) and settling the answer onchain. Both sides of every trade are vetted and whitelisted through Securitize.

In May, Grove launched Basin, which commits up to $1 billion a day in stablecoins to holders of BUIDL and Janus Henderson's JTRSY. File an approved redemption and Basin pays you in dollar tokens on the spot, then collects when the fund settles the old way.

It's a lender standing in front of the redemption desk, financing the wait. In late April, according to Pantera's timeline, OKX started taking BUIDL as collateral, so holders can borrow against it on the exchange's own books.

All of it is useful. Basin turns a next-day wire into a same-minute payment, which matters to anyone running a treasury onchain. But every one of these rooms holds the same people: qualified purchasers, a few approved dealers, and a lender the fund repays. Four months after the UniswapX launch, Pantera's June data still filed BUIDL among the big products with little or no observed trading.

The open lending markets show it from the other side. In the Morpho vaults Pantera traced, loans backed by tokenized private credit came to about $120 million at the end of June. Loans backed by tokenized Treasuries came to about $12 million. The safest collateral in the world, wrapped in a token, barely shows up in the public lending market.

If you want to see where the private-room model goes when nobody asks it to trade, look at Broadridge. Its Distributed Ledger Repo platform, where banks and dealers swap securities for short-term cash among approved counterparties, is "tokenizing over $351 billion a day," according to the company's September 9 release.

That's repo settlement rather than trading, so the comparison is loose. Still, one gated ledger moves more before lunch than every public tokenized market Pantera tracked did in all of June. The gated model works fine, it's just that it's only working for the people already inside.

The SEC built the same room for stocks

Two days after the Senate failed to advance the Clarity Act, the vote this newsletter covered two issues ago, the SEC used its own exemption power instead. Release 34-106402 lets a new kind of venue trade tokenized versions of U.S.-listed stocks for five years without registering as an exchange, and lets the firms that stock its trading pools skip registering as dealers.

The conditions, as Sullivan & Cromwell summarizes them, read like the BUIDL room with stocks moved in. Only approved traders get in. The SEC gives venues two ways to enforce that: keep a list of approved wallets, or use tokens that won't move to a wallet nobody has checked.

The software has to run on a public blockchain that anyone can read and write to. The pool on top of it is gated.

Then there's a ceiling. A venue can list up to 75 large-company stocks, and its trading in each is capped at 0.25 percent of that stock's normal daily volume on the regular exchanges (smaller companies get 2.5 percent, across up to 250 names).

Break the cap twice and that stock stops trading for three months. The token has to carry the same dividends and votes as the share, which rules out the offshore "stock tokens" that are really debt notes. And a company can block a third party's token of its stock by objecting within 30 days of being told about it.

The exemption only matters for venues with an operator who decides who gets in. Open software with no one running it never needed permission, as Commissioner Hester Peirce noted the day the order issued: "An investor does not need an exemption to avail herself of permissionless smart contracts."

The funds didn't get in. The order gives no relief under the Investment Company Act, the law that governs funds, so a tokenized money market fund can't be listed for trading on one of these venues.

The most it can do is sit in a pool as the cash on the other side of a stock trade. That's an odd place to leave it. By Pantera's math, a large sale of tokenized stock clears in half a day, while the same sale of a tokenized Treasury fund takes about 126 days, and Treasury funds hold four-fifths of the gated money. The SEC built its first public market for the product that needed one least. The one stuck behind the redemption desk got a part as somebody else's cash.

What did change on September 17 is who holds the list. For stocks, it moves from the issuer's transfer agent to the venue operator.

The list could end up in your wallet

Six days later, Peirce sketched a third option. Speaking at SIFMA's digital assets conference on September 23, she called the exemption "time- and size-limited" and argued that "attribute-based credentials could greenlight individuals holding verifiable credentials that attest to specific facts: age, citizenship, accredited investor status, absence from sanctions lists, without revealing the underlying data."

She also said "we should make it easier for registered entities to rely on third-party identity verification" when they check who their customers are.

Put plainly, that's a list that travels with the investor. Today every room keeps its own. Securitize approves you for BUIDL, a stock venue will approve you for its pool, and the next venue starts from zero. A credential that proves you're a qualified purchaser, readable by any venue's software, would let a whitelisted token sit in more than one room without each room re-running the paperwork.

The token would still be gated. The gate would get cheaper to walk through, and that cost is most of what keeps these markets thin.

It's one commissioner's speech, and nothing in it is a rule. The same speech defined a truly permissionless network as one where "there is no custodial intermediary standing between users and their assets, and when all participants and transactions are treated neutrally," which is aligned with the Open Money thesis on what a permissionless network is and why they are important to composable finance.

The honest case against this read

The strongest objection is in Pantera's own report. Gated products are mostly Treasury funds, and Treasury funds are built to be held and redeemed, so open access doesn't rescue them.

Ondo's USDY is open, about $2.1 billion, and traded 0.1 percent of its value in June. Spiko's euro Treasury fund, also open and around $0.9 billion, didn't trade at all.

It runs the other way too: private funds are 71 percent permissioned and still traded 9.4 percent of their value. Pantera says plainly that part of the gap is product mix. If open yield tokens sit still and gated credit tokens trade, maybe I'm giving the whitelist too much of the blame.

Two things keep me on this side. However Pantera drew the lines, no permissioned product ever made the group that both traded and was widely held. And nobody builds a $1 billion-a-day cash facility for owners who are happy leaving by wire.

The second objection is measurement. Pantera sees decentralized exchanges and onchain trading platforms, and it says a lot of Treasury fund activity happens on venues outside its data, including Securitize's own regulated trading system. So 0.2 percent is the visible share, and it undercounts by an amount nobody outside those venues can check. I'd bet the gap is small next to $16.5 billion. It's still a bet.

The third is the source. Pantera discloses that it and its principals have invested in some of the instruments the report covers. Several of its summary figures also disagree with its own tables (the Treasury total shows up as both $16.5 billion and $15.5 billion), so I've used the detailed sections throughout and skipped the callout boxes.

Stablecoins Own Nearly $200 Billion of Treasury Bills: Why Washington Wants More and Europe Wants a Cap (2026)

Treasury’s deputy secretary told the bond market on September 22 that stablecoin issuers hold nearly $200 billion of Treasury bills and called it a growth opportunity.

Daniel McGlynnDaniel McGlynn

Sources

[1] Pantera Capital Research. "The State of Tokenization," September 2026. Market baseline through June 30, 2026. Access classification and June trading split (pp. 6 to 8), asset-class trading and days-to-exit benchmark (pp. 9 to 10), whitelist-only threshold results (p. 15), Morpho collateral case study (pp. 16 to 17), Q2 timeline (p. 34), disclosures (p. 39). Portal: https://tokenization.panteracapital.com/

[2] RWA.xyz. "BlackRock USD Institutional Digital Liquidity Fund (BUIDL)," asset page, market data as of October 1, 2026. Total value $2,248,058,999, 104 holders, 27 trailing 30-day active addresses, $744,874,837 monthly transfer volume, subscription and redemption terms. https://app.rwa.xyz/assets/BUIDL

[3] U.S. Securities and Exchange Commission. "Order Granting Temporary Conditional Exemptive Relief for Certain Distributed Ledger Trading Venues and Liquidity Providers for Tokenized NMS Stocks, and Request for Comment," Exchange Act Release No. 34-106402, September 17, 2026. Duration ("set to expire five years after publication") and issuer objection within 30 calendar days of the Issuer Notice. https://www.sec.gov/files/rules/exorders/2026/34-106402.pdf

[4] Sullivan & Cromwell LLP. "SEC Issues 'Innovation Exemption' for Tokenized Securities," September 18, 2026. Permissioning, symbol and volume tiers, pairing rules, Investment Company Act carve-out (note 9). https://www.sullcrom.com/insights/memo/2026/September/SEC-Issues-Innovation-Exemption-for-Tokenized-Securities

[5] U.S. Securities and Exchange Commission. Commissioner Hester M. Peirce, "Slumber Number: Innovation Exemption Statement," September 17, 2026. https://www.sec.gov/newsroom/speeches-statements/peirce-slumber-number-innovation-exemption-statement-091726

[6] U.S. Securities and Exchange Commission. Commissioner Hester M. Peirce, "Looking for Change in Haystacks," remarks at SIFMA's Digital Assets Conference, September 23, 2026. https://www.sec.gov/newsroom/speeches-statements/peirce-looking-change-haystacks-remarks-sifma-s-digital-assets-conference-092326

[7] The Block. "BlackRock, Securitize tap DeFi giant Uniswap for direct onchain BUIDL trading; UNI surges 20%," February 11, 2026. https://www.theblock.co/news/business/2026-02-11-blackrock-securitize-tap-defi-giant-uniswap-for-direct-onchain-buidl-trading-uni-surges-20-389421

[8] CoinDesk. "BlackRock, Janus Henderson tokenized funds get instant redemptions with new $1 billion facility," May 14, 2026. https://www.coindesk.com/business/2026/05/14/blackrock-janus-henderson-tokenized-funds-get-instant-redemptions-with-new-usd1-billion-facility

[9] Broadridge Financial Solutions. "Broadridge Launches DLX," press release, September 9, 2026. DLR described as "tokenizing over $351 billion a day." https://www.broadridge.com/press-release/2026/broadridge-launches-dlx