ETFs held about $300 billion worldwide when WisdomTree decided they were a product worth focusing on roughly 20 years ago. That number is now over $13 trillion in the U.S. alone.
WisdomTree’s head of digital assets, Will Peck, says the firm is betting that tokenization on public blockchains could be the next structural shift of that magnitude.
“We asked ourselves the question: what could do to ETFs what ETFs did to mutual funds?” Peck said on TheStreet Roundtable. “We saw tokenization on public blockchains as playing a really big role in that.”
What is WisdomTree actually building?
WisdomTree’s approach goes beyond simply putting an existing fund wrapper on a blockchain. They want to be the regulated bridge between traditional assets that exist off-chain and the tokens that represent them on-chain.
The reality of tokenized real-world assets (RWAs) is that there is always a physical or financial asset sitting somewhere off the blockchain. A legal structure has to bind that asset to its on-chain representation.
WisdomTree wants to be the entity investors trust to hold that together.
“When you’re talking about tokenized real-world assets, there’s an asset that exists somewhere off-chain that you’re representing in a token on-chain, and there needs to be some sort of legal construct binding those things together,” Peck said. “We want to be the right kind of legal, regulated entity to enable that.”
Why crypto-natives should care
The interesting move is who WisdomTree is building for. Not just TradFi allocators looking for blockchain efficiency. Peck said the firm wants to serve the self-custody, DeFi-native crowd directly.
He described a situation where a crypto investor who holds assets in a self-hosted wallet and uses decentralized protocols does not have great options for a risk-free rate of return. They either park funds in lightly regulated yield platforms or accept zero yield on stablecoins.
WisdomTree’s answer is a tokenized money market fund, regulated and backed by real assets, that plugs into the same on-chain infrastructure those users already live in.
“Instead of needing to rely on some sort of lightly unregulated kind of vehicle for yield, they can get their risk-free rate through a tokenized money market fund,” Peck said. “And they can do what they want to do beyond that.”
What this signals for retail investors
For the average crypto holder, the signal here is that the line between TradFi products and DeFi rails is dissolving fast.
A firm managing over $150 billion in assets is not experimenting with tokenization as a side project. They are framing it as the successor to the structure that built their entire business.
If Peck’s comparison holds, and tokenized funds follow even a fraction of the trajectory ETFs took over the past two decades, the way retail investors access everything from money markets to index funds could look fundamentally different within a few years.
