By Zeus
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Core idea: “Onchain” makes the ledger fast. It does not make the real-world asset move at blockchain speed.
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One of the biggest silent misunderstandings in tokenization is the idea that once something is “onchain,” it should behave like crypto.
Fast settlement. Instant transfers. Real time everything.
When that doesn’t happen, people assume the tech is broken, the product is bad, or the promise was fake.
In reality, nothing is broken. The expectation is.
Blockchains settle in seconds. The real world doesn’t. And tokenization doesn’t magically change that.
When you tokenize an asset, you’re not pulling it out of reality and dropping it into DeFi. You’re creating a digital representation of something that still lives in a world of legal processes, banking rails, reporting cycles, and human checks.
A useful way to think about this is that a tokenized asset is more like a receipt than a live object.
It updates when something real happens. Until then, there’s nothing new to record.
The blockchain isn’t watching the asset in real time. It’s recording verified events after they occur.
Traditional markets run on delayed settlement cycles.
Trades don’t actually settle instantly. Ownership, cash movements, and reconciliation happen later, often days later.
Tokenization aims to reduce that gap. But reducing isn’t the same as eliminating it.
Moving from T+2 to near real time settlement is a big shift. But it still requires banks, custodians, and infrastructure to be ready for that speed. Many aren’t.
Faster settlement sounds great until you realise it often shifts risk instead of removing it.
If everything settles instantly, there’s no buffer for errors, failed payments become more painful, and operational issues have less time to be caught.