Binance Founder CZ Acknowledges Government Negotiations for Tokenization of National Assets

Changpeng “CZ” Zhao, the founder of Binance, revealed that multiple governments are exploring the possibility of tokenizing their national assets on blockchain networks. This shift is part of a broader trend in crypto adoption, moving beyond exchanges and stablecoins to include state-owned assets.

Key Takeaways

Governments are in talks to tokenize national assets using blockchain technology.
Tokenization is viewed as a method for governments to enhance liquidity and market access.
Examples include Pakistan planning to tokenize sovereign debt and the EU advancing regulatory frameworks for tokenized securities.
Traditional financial institutions like the NYSE are preparing for tokenized trading platforms.
Analysts note a significant rise in tokenization-related market activities, indicating growing acceptance.

Government Engagement in Tokenization

Changpeng Zhao, known as CZ, shared at the World Economic Forum in Davos that he is negotiating with over a dozen governments to move toward the tokenization of state-owned assets on blockchain platforms. He sees this development as the next significant chapter in cryptocurrency adoption, following the initial focus on exchanges and stablecoins.

CZ emphasizes that while various sectors within crypto are still emerging or experimental, governments are taking serious steps to capitalize on their assets through tokenization. By doing so, they aim to harness financial returns from these assets without relying on private intermediaries.

Benefits of Tokenization for National Assets

Zhao explained that governments are keen to tokenize substantial asset categories, which allows them to realize capital gains more efficiently. Tokenization facilitates improved liquidity and market access, enabling governments to reinvest these funds into domestic projects and infrastructure.

This approach to asset management differs from previous private sector efforts to tokenize real-world assets. By converting national assets like government bonds, oil or gold commodities, and public real estate into digital tokens, governments can provide features like fractional ownership, continuous trading, expedited settlement, and automated payments via smart contracts.

Moreover, this framework supports transparency and allows governments greater control over the issuance and distribution of these assets, ensuring that the financial benefits remain in the public sector.

Examples of Progress in Tokenization

Several countries and financial institutions are already on this path. For instance, Pakistan’s finance ministry recently announced intentions to tokenize up to $2 billion in sovereign debt to modernize its public debt markets and encourage retail investment.

In Europe, the European Union's DLT Pilot Regime provides a regulatory framework for trading and settling tokenized securities. The UK is also moving forward by appointing a designated official to ensure a smooth transition to a blockchain-based financial system.

Traditional Markets and Tokenization

In the traditional finance arena, the New York Stock Exchange (NYSE) has announced its plans to build a platform dedicated to the trading of tokenized stocks and exchange-traded funds, aiming for 24/7 trading and on-chain settlement, pending regulatory approval. CZ has expressed his support for this initiative, viewing it as positively impacting the crypto ecosystem.

Significant regulatory progress in the United States has also emerged. The Securities and Exchange Commission granted the Depository Trust and Clearing Corporation a rare no-action letter, allowing it to develop a controlled program for tokenization covering U.S. Treasuries, ETFs, and Russell 1000 equities. This service is set to begin in late 2026 on designated blockchains, ensuring that these tokenized assets maintain the same legal protections as traditional securities.

Zhao further associated the rise in tokenization with broader trends in payments, particularly within stablecoins. He mentioned that the future holds the promise of “invisible payments,” where transactions occur in fiat currency while utilizing crypto technologies in the background.

Market Trends and Insights

Market data indicates that tokenization is already gaining momentum. For example, tokenized gold products achieved an increase of nearly $2.8 billion in net value in 2025, with total market capitalization soaring by 177% year over year and trading volumes nearing those of leading global gold investment vehicles. Analysts suggest that this trend demonstrates how on-chain markets are starting to integrate liquidity that has traditionally been funneled through conventional financial systems.