The $1.4 quadrillion bet most fintech companies missed

Bank infrastructure is dead. Here's what's next.

Author

Will Leatherman
January 23, 2025

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This week we’re diving into the tokenization wave that's reshaping financial infrastructure.

In a rush? Look for the 🔑’s for easy skimming.

I’m Will Leatherman, the founder of Catalyst. We help B2B founders, agency owners, and corporate marketers create executive-led, thought leadership content that drives qualified leads. Our clients include kits.ai, a16z, abode, and more.

If you’re ready to 10x your content output, I always love to chat strategy.

Will’s Picks

A few things I’ve loved reading this month—

💰 The Tokenization Explosion

Financial infrastructure is getting completely rebuilt right now. Traditional banks spend 6 months planning what Web3 builds in a week. But everyone's too busy arguing about Bitcoin prices and crypto drama to notice what’s happening.

🔑 Every bond, stock, and piece of real estate is about to get tokenized.

The data tells the story:

Current Market Size by Asset Class—

  • Currency: $7T

  • Government Bonds & Debt: $277T

  • Stock Market: $89.5T

  • Real Estate: $280.6T

  • Derivatives: $6,667.1T

Total addressable market: $1.4 quadrillion 

🔑 But what's fascinating is that stablecoins currently represent 97% of tokenized assets. This means we're just scratching the surface of tokenization's potential across other asset classes.

💸 The Infrastructure Revolution

Two key developments in 2024 signal the acceleration:

1. Transaction Volume Growth 🔑

  • Stablecoin transactions doubled from $10T in 2023 to $20T in 2024

  • Market cap growth up 300% year-over-year

  • 90% of CBDC initiatives are now EVM compatible

2. Institutional Integration 🔑

  • Traditional financial players are making decisive moves:

    • BBVA is prototyping with Visa's new VTAP platform for 2025

    • BlackRock's Bitcoin ETF emerged as their fastest-growing offering

    • Singapore is leading regulatory framework development with 40 organizations across 7 countries

🤺 Strategic Implications

The market is splitting into two clear paths:

1. Asset Tokenization 🔑

  • Integration between previously disconnected asset classes

  • Parallels to money digitization (1950-90s)

  • CBDC enabled, supported by regulatory tailwinds

2. Financial Market Infrastructure 🔑

  • Migration to blockchain rails

  • Comparable to cloud migration in 2010s

  • Market potential: $3.2T

⌨️ What This Means for FinTech Companies

The historical pattern is clear: Money digitization (1950-90s) → Cloud migration (2010s) → Token adoption (2024+)

Each wave created new giants. And we're seeing the same playbook unfold:

  • Payment processors seeing infrastructure become commoditized

  • Traditional banks prioritizing regulatory compliance

  • Startups focusing on institutional bridges and compliance tools

The Next 24 Months Are Critical

Companies have two choices:

  1. Build token-based infrastructure now and capture market share

  2. Play catch-up later from a position of weakness

🔑 The winners will be those who can bridge traditional finance with blockchain rails while maintaining regulatory compliance.

As your full-service content partner, Catalyst helps fintech companies navigate this transition through executive-led content that builds authority and drives growth. Our proven process helps you:

  • Amplify thought leadership

  • Generate qualified leads

  • Drive measurable business impact

Will