Wall Street Banks See Tokenization as a Growth Opportunity, Not a Threat

Goldman Sachs, Wells Fargo and Morgan Stanley used this week’s third-quarter earnings calls to explain how they see tokenization, though none put a revenue figure on it. Goldman CEO David Solomon was asked whether tokenization, DeFi and prediction markets could eat into trading revenue.

He said they might do the opposite, comparing the shift to electronic stock trading almost 50 years ago, which Goldman adapted to as its equities business grew. He said the changes bring more products, activity, new clients and broader distribution. Goldman built its GS DAP platform in 2022 and took part in a half-day run of a DTCC tokenization service in July. It now wants to use that service at greater scale, though Solomon admitted activity so far is small and at the margin.

Wells Fargo Tokenized Deposits and Cross-Border Payments

Wells Fargo already processes cross-border payments with tokenized deposits, with funds reaching beneficiary accounts in two minutes or less. CFO Michael Santomassimo said the service is in production but still small in volume. Because the bank lacks a large international branch network, he sees tokenized deposits as a way to win more cross border business without building one. Tokenized securities, real-world assets and crypto trading for wealth clients are also possible, though no timeline was given.

Morgan Stanley Advisory Role

Morgan Stanley’s focus is on advice. CFO Sharon Yeshaya said tokenization makes moving assets faster and easier, but clients will still need guidance. The bank announced no new product and called tokenization another opportunity.