The Evolution of Financial Market Infrastructure: From Digitalization to Tokenization
1 China Development Bank, Beijing 100031, China;
2 Cardiff Business School, Cardiff University, Cardiff CF10 3EU, UK
* Corresponding author:
* Author to whom correspondence should be addressed.
Received: 15 Feb 2023 / Accepted: 23 Feb 2023 / Published: 8 Mar 2023
Abstract
This paper examines the historical development and cross-sectional heterogeneities of Financial Market Infrastructure (FMI). From an evolutionary perspective, we review and compare FMIs in the US, Europe, and China. We identify an emerging trend in which the development of FMI is transitioning from digitalization to tokenization with the rise of Distributed Ledger Technology (DLT). Digitalization reinforces centralization, while tokenization promotes decentralization, posing complex challenges to regulatory framework which is also part of FMI. We then specifically analyze DLT-based FMI in the bond market, evaluate different models of tokenization, and propose a heterogeneous consortium blockchain solution.
Keywords: digitalization; tokenization; blockchain; bond
OPEN ACCESS
This is an open access article distributed under the Creative Commons Attribution
License which permits unrestricted use, distribution, and reproduction in any medium,
provided the original work is properly cited. (CC BY 4.0).
CITE
Guo, D.; Zhou, P. The Evolution of Financial Market Infrastructure: From Digitalization to Tokenization. ijie 2023, 2, 2.
Guo D, Zhou P. The Evolution of Financial Market Infrastructure: From Digitalization to Tokenization. International Journal of Innovation and Entrepreneurship. 2023; 2(1):2.
Guo, Dong; Zhou, Peng. 2023. "The Evolution of Financial Market Infrastructure: From Digitalization to Tokenization." ijie 2, no. 1: 2.
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