Why tokenization is an ETF-style market structure revolution
The article explores how the tokenization of assets mirrors the historical market structure revolution triggered by ETFs. It argues that tokenization uses similar arbitrage mechanisms to maintain price stability and liquidity for underlying assets.
Why it matters
Understanding this parallel helps investors and regulators anticipate how tokenized assets might evolve into a major, standardized financial market.
Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Why tokenization is an ETF-style market structure revolution The current tokenization dialogue and pattern resemble ETFs’ early days, which ultimately transformed into a $10+ trillion market, Lie argues. By Michael Lie | Edited by Betsy Farber Jun 4, 2026, 2:44 p.m. 4 min read Make preferred on (MCCAIG/Getty Images) In the 1990s , exchange-traded funds (ETFs) were a novel idea. Many saw them simply as a new wrapper for traditional assets – a convenient repackaging of mutual funds. In reality, ETFs triggered a market structure revolution. By introducing creation/redemption mechanisms and arbitrage-driven liquidity, ETFs fundamentally changed how markets functioned and how investors accessed assets. ETFs blurred the line between primary and secondary markets and turned arbitrage into the mechanism for holding the system together.
The piece is an analytical argument regarding financial market structure, though it leans into the pro-crypto narrative common in industry publications.
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