Wall Street banks position tokenization as growth driver for trading, payments and advice

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Wall Street banks on tokenization

Highlights

Goldman Sachs CEO David Solomon positions tokenization and decentralized finance as drivers for new trading products and clients, citing ongoing digital asset infrastructure development and GS DAP platform progress.
Wells Fargo CFO Michael Santomassimo reports its tokenized deposit system processes cross-border payments in under two minutes, enabling the bank to compete internationally without broadening its physical branch network.
Morgan Stanley CFO Sharon Yeshaya highlights tokenization's potential to increase wealth management demand by enabling faster, low-friction asset transfers, integrating blockchain-driven advisory and investment services.

Bank strategies take shape after earnings calls

As reported by CoinDesk, executives at Goldman Sachs, Wells Fargo and Morgan Stanley used this week's third-quarter earnings calls to give a clearer view of how they see tokenization developing, although none attached a revenue forecast to the opportunity.

Goldman Sachs is focusing on trading. CEO David Solomon says tokenization, decentralized finance and prediction markets could ultimately create more products, broader distribution channels and potentially new clients, rather than taking business away from the firm's trading desks. He compares the shift to the move toward electronic stock trading decades ago, when similar concerns emerged but Goldman adapted and its equities business expanded.

The bank has been building digital asset infrastructure for years, including its GS DAP platform launched in 2022, and has worked on tokenizing bonds, money market funds and real estate. In July, Goldman took part in a half-day run of a tokenization service from the Depository Trust & Clearing Corporation, and Solomon says the bank is now exploring broader use cases that could lower costs, automate transactions and make assets easier to trade, even as current activity remains small.

Wells Fargo is further along in one area, with CFO Michael Santomassimo saying its tokenized deposit system is already handling cross-border payments in two minutes or less. He says volumes are still small, but the technology could help the bank compete for more international payments business without building a large overseas branch network.

Payments and advisory benefits come into focus

Morgan Stanley is emphasizing the advisory implications of a market where investors can move assets faster and with fewer frictions. CFO Sharon Yeshaya says a tokenized system may make transfers easier, but that does not reduce the need for advice, and could instead support more demand for wealth management services.

Wells Fargo also sees additional uses beyond payments, including tokenized securities, real-world assets and crypto trading for wealth clients, although Santomassimo does not give a timeline for those services. Morgan Stanley, for its part, does not announce a new tokenization product, but presents the technology as another avenue for investment across its wealth management and institutional securities operations.

The comments suggest large banks are treating tokenization as an operational and commercial opportunity tied to market infrastructure, client reach and service demand. As more financial firms offer or plan blockchain-based versions of traditional assets that can trade around the clock with fewer geographic limits, established banks appear to be positioning for growth within that shift rather than resisting it.

Our earlier article on the Bank of England’s push for “bare metal” recovery planning explained how regulators want major lenders to be able to restore critical services even if core technology is compromised. It highlighted concerns that AI is increasing the scale and complexity of cyber attacks, prompting supervisors to demand deeper operational resilience and more robust fallback options across the financial system.

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