The financial industry is experiencing a significant shift towards institutional adoption of digital assets and tokenization, moving beyond initial hype to tangible, scaled solutions that integrate with existing financial infrastructure.
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So hello again and welcome to the next
panel on how tokenization will redefine
banking in payments. Uh for this
discussion we have uh leaders from four
of the most preminent financial
institutions city
and JP Morgan. Before we kick off maybe
if we take 30 seconds each to briefly
introduce yourselves and what your firms
are doing in digital assets. Uh Ryan
Rug. I head up digital assets for city's
TTS business. Um been at the
organization about three years now. Um
the team that launched city token
service. So look forward to sharing more.
more.
>> Patrick Corker. I'm in the product and
innovation division at BMY um under
Carolyn Weinberg and we're focusing a
lot on the tokenization of all things
including many of the digital extensions
of our traditional businesses today
across cash collateral payments um and
fund infrastructure.
>> I'm Tom Shack. I'm the chief innovation
officer for Swift. I've been in that
role for um for six years now and uh
we've had some pretty exciting
announcements uh just recently at the
end of last year both in terms of
improving the customer experience for
existing crossber payments and the
corresponding banking business model as
well as uh announcing a adding a
technical infrastructure layer a
blockchain layer on top of the swift
network which we'll get a chance to talk
about more later on in the session.
>> Hi everyone, I'm Nelly Zultzman and I
lead our infrastructure partnerships for
Kexus at JP Morgan. Uh, Kexus is JP
Morgan's blockchain business unit. We've
been exploring this space for about a
decade and we do everything from asset tokenization
tokenization
um providing external tokenization
services, blockchain based payments
through blockchain deposit accounts and
of course JPMCoin.
>> Excellent. So to kick us off want to
take us back one year. Uh last year at
this same summit there was lots of
momentum in digital assets. There's lots
of discussion of 2025 being the
inflection year, the pivotal year for
adoption for tradi. So would love to
hear has 2025 been an inflection point
for institututional adoption and if so
how? Yeah, when you were prepping for
this, it made me like think back to a
year ago when we were here and we're
talking about how we were onboarding
clients, we were processing
multi-million dollar transactions to
kind of looking back and reflect upon
where we are and you know this year
we're now processing billions. We now
have a multitude higher magnitude of
clients on the platform. We've announced
integrations with our solution 247 USD
clearing to truly provide that
multi-bank solution to our clients. We
announced collaborations with Coinbase
to be able to do you know stable. So I
think that it really was you know a
inflection point for us and now we're
starting to see you know scalability
adoption across the platform.
>> I would completely agree with that. Um I
think it was very important for the
industry as a whole. BMY has been in the
space for some time visits custody
platform. We were the first GIB to offer
digital asset custody but then extending
that out into other areas has been a
matter of quite a bit of investment over
time and admittedly we've been a little
quiet on the announcement front but
nonetheless building expeditiously to
meet what I see as a market that is um
full force coming into digital assets
and particularly tokenization.
Yeah, 2025's been been quite a year and
before we kind of just jump ahead and
talk about redefining banking and
payments, I think it's really important
to um acknowledge a couple things which
is the fact that existing payment rails
uh are going to be here for the
foreseeable future. Uh and what we're
trying to do is is is to offer options
and capabilities to our banks uh to to
be able to do crossber payments better.
Right? So what we have today works uh it
has rulebooks. It's based on standards.
Uh it moves trillions of dollars every
day. And I think everybody would quick
quickly agree that we're going to be in
a kind of a multi-chain, multi-leed
world uh for the foreseeable future.
Right? So what we're building on is is
experience and trust. And the decision
and kind of the big move for us in 2025
was not only announcing the work that
we're doing on this scheme, um but also
in terms of introducing the ledger and a
blockchain infrastructure that actually
runs on top of the Swift network.
doesn't replace the Swift network. Um,
nothing's going away. What we're going
to do is offer uh capabilities and
options to our banks, you know, starting
with the fairly narrow use case to be
able to do crossber payments how they
want to do crossber payments and
leveraging the infrastructure and the
trust that they have today. And so this
whole idea of kind of breaking down the
barriers and making it easy, you know,
as new digital assets come online,
whether they're a stable coin, whether a
tokenized deposit in other parts of the
world outside of the US, CBDC's, you
know, offering that capability um to be
able to not only extend into new asset
types and new forms of value, but the
new settlement locations um is exactly
the right way to go. And so um we're
really excited about options that we
could offer, but we're all also very
realistic about how the world runs
today. and we don't have a this view
that we're in a parallel universe and
you're somehow going to come in on a
Monday, flip the switch and everything's
going to be new. Um, some people think
that we're not in that camp and that's
not what we're seeing as evidence in the
marketplace. And we are seeing I think
in 2025 a really serious attempt to kind
of step into how institutions operate
today, not the other way around, right?
And that's pretty well known. There's a
lot to leverage there.
I think for JP Morgan 2025 was maybe a
year where we got to reap some of the
investments we've been making earlier on
as the industry mindet mind mindset
shifted. Um a lot of what we build is
ultimately meant for network use network
adoption. Um and so what we saw in 2025
were, you know, our peers coming to the
table, our some of our larger clients
coming to the table and also the ability
to expand out some of our knowhow beyond
um sort of an a single ecosystem and
reach out integrate with public
blockchain and I think that mindset
shift is going to bear further fruit in
the years to come.
>> Excellent. So looks there's been pieces
around the utility and early adoption.
Um and then there's continued
experimentation and bridging a bit
between tradi and and onchain which is
obviously core to to the ono vision. Uh
maybe if we start looking forward uh one
of the pieces also that's been
significantly growing over the the past
year is moving from pilot scale
applications. We touched on a few.
>> Um that being said a lot of the onchain
activity remains retail. I think Tom you
said in our discussion as we were
preparing $50 is not $50 million. Uh and
so as you think of institutional
adoption what are the primary unlocks
whether technology regulatory product
market fit? I'm sure there's a bit of
all of the above. So we'd love to hear
to you in particular as you think of
next year what are the one or two
unlocks that we truly need to address as
an industry.
>> Yeah I think one of the things that you
know was a core to our design was making
it fully integrated into our traditional
systems. So the way that we view city
token service is it's just a you know a
drop-own box and that we completely
offiscate all the complexity for day one
for our clients. They don't have to host
a node. They don't have to have a
wallet. They don't have to manage the
keys. All the operations around it we do
for them. They don't actually, you know,
it's covered under their MSA from an
account standpoint also because one of
the feedbacks that we got from our
clients was they have hundreds if not
thousands of accounts across these
multitude of banks across the globe and
they don't want additional operation.
they want to really streamline that. So
being able to, you know, we if a client
wants to send a to um wants to do a
transaction on Saturday morning from New
York to Singapore, you know, literally
we'll mint it in New York, we'll send it
to Singapore and we'll burn it and it's
also cash for cash in their account and
that was by design also again meeting
our institutional clients where they are
where their treasury ERP systems a lot
of them can't even handle real time let
let alone account for tokens. So I think
that you know if you think about
technology over time and some of the
technologies that were adopted verse not
you think of like the kind of the story
between the Blackberry and the iPhone
like why was the Blackberry not widely
adopted it wasn't super intuitive and
easy to use and like seamless. So kind
of taking that into our core design when
we're doing it that we're viewing this
just as another set of payment rails as
like Tom mentioned that you know it will
solve some pain points to create that
24/7 365 but you know clients may not
always want to use it. So the fully
integrated into their systems we thought
was really important where they didn't
have to have a standalone kind of system
for it.
I think that's very well said and and
tying it back to some of um Tom's
earlier comments, you know, these things
do take time and they take time for a
number of reasons, not least of which is
to obiscate away some of the complexity
for our customers which is important for
institutional adoption. It's largely
where we're focused given our remit as
much of the financial plumbing of the
existing ecosystem for us to say that
the technology itself is capable of
something is demonstrabably true. And
now what banks have done at large and
BMY is an example of that have funded
things, they've staffed things, they are
building things, but then to radiate
outwards to the rest of the ecosystem
and create standards for this technology
that everyone can participate in is
where a lot of us are spending time today.
today.
>> Good. I think there's um a couple really
important unlocks here because on one
hand we see the demand for digital
money, right? 300 billion of value um
sitting on chain with stable coins. Um
but we still don't have clarity for
example from regulators and that being
kind of um uh harmonized across
different parts of the world um that
that's going to be a an acceptable asset
again at scale $550 is not $50 million.
And so is a stable coin going to be
acceptable? You know when today the
standard practice everywhere in the
world is to settle these institutional
payments in central bank money. A stable
coin is not central bank money. Right?
All right. I'm not saying they're bad.
I'm not saying they're not useful in
some corridors. But again, if we keep
the institutional lens on that, um, that
still needs to get worked out. What what
exactly are we going to use for the
asset for settlement that fully
extinguishes the the the liability that
came along with the payment that's being
requested cross border? It's a really
it's it's in one some ways it's kind of
subtle, but it's really it's really
important. The other one that I I'm I'm
optimistic about, but there's still work
to do, is how do we actually and what do
we do when we say we're going to settle
a deposit token on chain, you know,
because we know that that privacy for is
table stakes in institutional finance,
right? You're not just going to publish
bank A and bank B did this amount at
this time on a public blockchain with
PIIA information. That's not happening,
right? So, privacy matters. Um but but
the the temptation for open shared
public infrastructure uh like the the
network uh the internet like we see
what's being built in Ethereum for
example it's irresistible right we're
going to get there the question is how
are we going to get there um we're not
going to do it on day one we don't have
to get there on day one we can kind of
start small and prove the value but
again if we really want to get to scale
and we want to do that on a global basis
um and harmonize you know what
settlement looks like these things need
to get worked Yeah, and there's really
good conversations happening to do that.
It's just not going to happen today or
tomorrow. But I but I think we are going
to I think we are going to get there
over time.
>> I think for me one of the greatest
unlocks would be um having the truly
composable ecosystem that has long been
the promise of this technology. And I
think where there's a little bit of a
footfall when we talk about trady use
cases especially you know recent
announcements about um you know one
group can announce their tokenizing
equities and another announces their you
know tokenizing cash etc. And each of
these are analyzed kind of independently
and people ask well what's the value out
of just a tokenized equity or just
tokenized cash. Um the conversation
should actually be if you had an
ecosystem that worked um in a truly
composable manner, what does that mean
for these institutions that have both
access to cash and equities? What does
that mean for the way data moves with
value? What does that mean for
reconciliation and operational cost? Um,
I don't think we're having these kinds
of conversations holistically enough in
part because I don't think a lot of
people are actually looking at the whole
ecosystem. Um, but that's kind of a big
passion of mine. So, I I do really feel
strongly about that.
>> Matthew, can I can I build on that
because I I think you hit it right on
the head. The composability uh is
probably the, you know, single most
important innovation that comes out of
blockchains. Um, and that leads to
interoperability. that leads to a way to
have a shared rulebook. That leads to a
way to develop standards. You know,
sometimes in a kind of a crypto uh
native world, it's kind of a a winner or
take all, right? I have the best
blockchain, everybody should do
something here. Let's, you know, let's
make sure they don't exist or we kind of
dominate here. That's not how finance
works globally. And if you don't have
that composability, you know, again, not
only between new forms of value being on
different blockchains, whether they're
private or permissioned or or fully open
public blockchains, if you don't have
that composability, you just never get
to scale. And it might even turn out
worse where a a group of financial
institutions in one part of the world um
do something one way and they do
something different another part of the
world and then they can never speak and
they build fragmentation and you just
start eroding the benefits of kind of
the blockchain and having these digital
assets in the first place. So it all
it's all going to anchor on
composability and and and they have to
be able to speak to each other in a
standardized you know compliant way.
>> I think that's right. I think the other
thing that BMY is focused on here is
interoperability. And so even if you
just take the clearest form of growth in
the space and where there is
institutional adoption today, which is
generally cash, so stable coins, deposit
tokens, etc., etc., we're seeing the
accordion draw out, there will be many
stable coins, there will be many deposit
tokens. How do those things talk to each
other? How do the platforms move value
across ecosystems as people build to
some degree in silos, which is how
things have worked historically, but we
have to connect those dots, and that's
where we're focused. And I I think what
the key thing is when I joined city
three years ago, we were part of several
of these different consortiums and
working groups, but we couldn't move a
token safely and soundly around the four
walls of our own institution and you
know building up that you know there's a
lot of legal compliance regulatory
considerations every branch we reached
out rolled out to getting you know
making sure we get regulatory approval
on it. So I think that now that a lot of
banks are at the standpoint that they
have a token no one wants just a city
token. We fully recognize that like all
of our clients want a multi-bank token
and you know working with these
different consortiums also integrating
into our solution 24/7. So we're a
corresponding bank for I think 1500 plus
banks. Of those 1500 banks three or 100
are on a solution called 247 USD
clearing. So right now we integrated
into we announced that at Cyos that we
were going to integrate into 247. So
being able to provide that as these
consortiums, as these networks continue
to evolve, as legislation and regulation
starts to shape around this space, but
like our mission has always been
creating a network that is multi-bank,
multi-asset, multi-et network, always on
and how you kind of lay those
foundations. And you know now that we
have cash on ledger in various forms if
it's stables if it's tokenized deposits
CBDC you can start bringing those other
assets as well on
>> and building on this topic of interoperability
interoperability
we have in the uniqueness of the summit
is a combination of tradies and also an
audience following us online of cos
founders of digital natives. How do you
see as the industry matures the
collaboration between these digital
native ecosystems and tradies? What are
some of the observations? What has
worked? And what are some of the I think
you brought up Nelly and and Tom last
week misconceptions of how to work
together between trafi and digital natives?
natives?
>> Sure. I I can start that one. Um I've
said this before on other panels. I
think for a long time due to various
factors there has been um like Tom said
a winner takes all mentality it has to
be trady versus DeFi or you know there's
some animosity there I always tell
people my business is to be a payments
provider at a bank right and it always
surprises people when I tell them you
know JP Morgan it as a payments business
services all of JP Morgan's other
competitors and other businesses, right?
So, markets competitors, broker dealers.
We are known as the bank to other
international banks. We're a very large
US dollar clear. It is part of our
business to understand where our clients
want to do payments business
and support those ecosystems as long as
we they're safe, sound, and legal,
right? And so for me, you know, I kind
of alluded to this in my last answer. I
really feel we've come to a point where
we can really double down and build
those bridges. My goal is to have a good
product that allows our clients to pay
for assets that are moving the most
efficiently. And if efficiently means 24
by7 or if it means moving it
programmatically which is a huge value
proposition we haven't really touched
on. Um that is what I want my payments
product to do and I want it to do it
relative to an asset that my client
wants. Um and so yeah I mean I think you
know we are looking at this with a very
collaborative mindset not just across
Chadfy but across different ecosystems.
Yeah, I think BMY is very similarly
situated. I think it starts with first
principles, which is success is not
mutually exclusive. And if you believe
in the tokenization of all things as we
do over some period of time, there's
going to be plenty of room for BMY to do
great things for their customer and
partners as well as cryptonative firms
that have built something innovative and
compelling to either partner with us or
the ecosystem. I think our goal is to
power the platform, power the ecosystem
and in many ways we are customers but we
are also partners, we're advisers, we're
thought sharers and in some ways you
know we do support some of the
infrastructure uh as mentioned earlier
um for the traditional ecosystem. So
>> yeah, have having been in this space for
a decade now, which I think sounds crazy
and seeing various strategies. The one
that if it was, you know, my R3 days
working at a fintech startup to working
for a global system integrator to now
working at city, it has to be a
combination of build by partner. You
have to be willing to, you know, invest
in the infrastructure, build some of it
out, but also partner, you know, like I
mentioned our Coinbased collaboration
like there's a lot of great companies
out there to invest in as well as buy
invest and, you know, we've invested in
Finale, we've invested in BVNK, and
we'll continue to invest in these
networks. So I think that you know is a
true collaboration like Nelly hit it
also like a lot of these like you know
different fintech out here are our
clients and we're servicing them across
a multitude of different businesses and
partner to help them really develop and
scale their business and also integrate
into our traditional businesses. So I
think it's a true partnership across the
ecosystem. But I think that you know
some of those misnomers out there about
either or. It's much more of a
collaborative approach and you know we
have conversations daily if not hourly
with a lot of these fintech here today.
>> You know I I love to um I love to attend
v events like this right and I don't use
to the traditional word anymore. It's
just finance right? It's like I don't
know. I don't know how we got this. I
think somebody on on uh crypto Twitter
came up with this traditional finance
thing and it just stuck. Um but it's
just finance. It's actually how things
work today. There's nothing wrong with
that. And in a lot of ways there's a lot
of things that work really well. But I
love events like this and and and I'll
listen to to um a fintech or somebody
who's coming from cryptonative and and
now their target is go after, you know,
regulated financial institutions. And my
question for him is very simple. Like
how are you not on the Swift network?
You just said your stated goal is to get
to every regulated financial institution
in the world. Well, guess what? There's
a way to do that and it's faster than
you think and it's cheaper than you
think and it probably is much more
beneficial than you think and it doesn't
it doesn't mean um you have to change
your business model. But if you really
want the distribution, you want
connectivity to all the regulated
financials, the the banks, the market
infrastructures, how could you not be on
Swift? It's a good question.
I get good answers too by the way. Get a
really good answer.
I love the the point on finance and so
if we think of finance broadly and we
project ourselves five 10 years from now
and maybe briefly give a sense for each
of you what is the most transformative
application you're looking towards as it
relates to tokenization for each of your businesses
businesses
>> I'll start um so I think that now that
we have cash on ledger and it's pretty
established um and you're sitting you're
starting to see it scale we talked about
we opened kind of where we are in 25
versus where we are now, processing
millions versus processing billions. I
think the next evolution is really that
multi-asset, right? That we we've talked
about DDP and atomic settlement for
ages, right? But I think back 10 years
ago when I said R3 and we're tokenizing
bonds and equities, we always going back
to Treadfire Rails to settle. It was
still like inefficient. And now that we
have that cash leg on ledger, I think
we're going to see more, you see more
and more asset managers announcing
different, you know, funds out there,
tokenized money market funds, CP, I
think we're going to continue to see
that. So, I think in a year from now
when we're back here, we'll be talking
about, you know, the realization of that
and starting to scale.
>> I think that's very well said. I mean, I
I think right now I wouldn't point to a
specific product or or product
primitive. I would say it's about the
promise versus the reality. And so 26 is
a very much rubber meet the road year
for many of us who've invested in this
space and said we want to do this within
the context of financial services
institutions which is a choice and we're
working with many of the people in this
room and and others to say okay what are
the right pieces of technology whether
we build them ourselves or whether we
partner with others to achieve that
scale and it's a very metricsoriented
conversation and I think we'll get there
but I think having achieved any piece of
that will be critical. Yeah, I would
just build on that. I mean, I think it's
it's all about scale, right? You can
start whatever initiative you want and
you can do PC's and you can do what I
call onesies and twoosies, but if you
can't get to scale, um, uh, then it's
kind of not worth it. And to actually
complicate things more, you know, we're
not far off from algorithms making
decisions that humans make, whether
that's liquidity, whether that's
treasury capital management, whether
that's risk decisions, or even payment
decisions. We're not very far off from
that. Um, and so if you can't scale with
what we have today with the
institutional business, you have no
chance of keeping up when algorithms
start making those decisions for you.
And in my view, we're not too far off
from that. And there's still some other
things that need to be added to the
stack to uh to make that possible.
>> I guess, you know, I agree with
everything that's been said. Maybe just
to add as we do look for scale and and
we've talked about the importance of
composability as we focus on um what the
cash leg of that looks like and what is
most interoperable. I think something we
don't discuss enough which I think will
really come to a head this year and next
year is how do we find scale in
tokenized cash without um challenging or
uh straining certain core principles
around the availability of liquidity and
credit in our system which is a
discussion we'll have to be having this
year as these projects grow and I think
the other uh development where we
probably need more dialogue as we ramp
up the use of various infrastructures is
how do we continue to evolve the
security of blockchain infrastructure um
especially with the advancements in
quantum and AI on our feet.
>> Excellent. Well, on that note, thank you
very much to all our panelists and have
a great rest of the day.
>> Thank you.
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