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To keep up with the growing demand of tokenisation, banks all over the world are stepping up their digital-asset initiatives. A recent industry research, conducted by Liminal Custody, analyses how conventional financial organisations may actually position themselves to progress from this tokenised asset market that is expected to grow up to $16 trillion by the end of this decade.

The timing here is very important because blockchain technology has grown beyond the stage of specialised research and now is at a significant position within global banking operations. The stablecoin volume ranges in tens of trillions of dollars each year, with the major chunk of these transactions happening outside of the traditional banking system. It is high time that the institutions realise the need to upgrade their wallet infrastructures to handle such large, continuous digital transactions required by this digital shift, transforming how money is exchanged.

The research emphasises on the move towards tokenisation and digital assets, resulting in a wave of stablecoin adoption. However, many companies are still restricted by outdated infrastructure that was not obviously built for blockchain-based activities. The emergence and adaptability of blockchain has opened gates to a fresh flow of monetisation which needs its own set of technology guardrails.

Liminal custody proposes what it refers to as the "Walled Garden" approach in order to bridge this infrastructural gap. This refers to the ready-to-plug-in technology framework that allows institutional users to maintain strict governance, compliance, and security criteria while allowing them to operate safely with publicly accessible blockchains. The approach of this strategy is a uniquely developed wallet framework that provides institutions with both flexibility as well as transparency by incorporating regulatory restrictions into digital asset transactions.

According to the research, within the next five years, the transaction volume of digital assets may make up for about 10 per cent of all financial activity worldwide, making strategic implementation fundamentally essential. Conventional financial organisations that neglect this shift in trend and fail to upgrade their custody and transaction systems are at the risk of being left out of this opportunity by large-fintech platforms that can plough in millions to create the technology framework from scratch.

According to the report, banks and institutions that take early action in this shift - by adopting platforms such as proposed in the report, will certainly benefit from the increased revenue streams, better liquidity management, and fast, more effective settlement cycles. Delayers risk becoming obsolete as tokenised finance enters the traditional capital markets.

Additionally, this study provides direction for CEOs, risk managers, and technology leaders getting ready for the adoption of the next stage of finance by providing them with an outline of tangible steps banks can take to pivot from pilot projects to production-ready digital asset management.

About Liminal Custody

Liminal Custody is a digital asset management infrastructure platform, offering secure wallet infrastructure and custody-technology solutions for institutions across the digital asset spectrum. This allows organisations to enforce complex transaction policies, and automate their treasury operations, all while maintaining direct control over their assets. Founded in 2021, Liminal Custody is certified with SOC 2 Type II, ISO 27001 & 27701 standards. Headquartered in Singapore, with offices across India, the UAE, and Taiwan, Liminal Custody serves clients across the APAC and MENA regions, helping them scale and manage digital asset operations securely and in compliance with regulatory standards.

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