Traditional financial giants are finally stepping into the arena!

You might not have realized it yet, but the impact of this event is absolutely beyond imagination—one of the world's largest custodial banks has officially launched a blockchain-based deposit settlement service for institutional clients. This is not a pilot project; this is a full-fledged commercial application.

What exactly is it? Simply put: funds from traditional banks can now be directly on-chain and processed in real-time via blockchain networks. Collateral management, margin settlement, cross-border payments—tasks that used to take several business days are now settled instantly.

Why is this so important?

First, it breaks down the barrier between traditional finance and blockchain. Some have said that crypto is a disruptor aiming to overthrow the existing financial system. But what is actually happening? Traditional financial giants are beginning to actively embrace blockchain technology. They see clearly—this technology can indeed solve their pain points, improve efficiency, and reduce costs.

Second, this means a huge liquidity pool is about to flow in. Imagine if top banks worldwide start using blockchain for settlement—how quickly would institutional funds enter the market? Currently, retail investors dominate, but once institutional capital starts flowing in on a large scale, the market landscape will change completely.

Third, the establishment of a compliance framework paves the way for future development. This bank is launching this service under a clear regulatory framework, which means fewer legal risks moving forward. Other banks will observe this case, think "Why can't we do this too," and follow suit quickly.

Is the RWA track about to take off?

Many are now discussing RWA—real-world asset tokenization. Real estate, bonds, art pieces—if these can be traded via blockchain, how big could the market become? Tokenized deposits are actually an important branch of RWA because bank deposits themselves are a type of financial asset, and now they can also be tokenized.

Imagine a scenario: an institution wants to borrow an asset as collateral, and they don’t have to wait for traditional settlement processes—they can complete it directly on-chain. The entire process shortens from days to seconds. What does this mean for high-frequency trading, derivatives markets, and cross-border settlements? A revolutionary increase in efficiency.

Of course, this isn’t a new idea today. Everyone knows the advantages of blockchain; the key is having enough recognition and participation. Now that this recognition has arrived and participants are coming in.

What does the future hold?

My judgment is that this will trigger a chain reaction. If this bank benefits from it, other major custodial institutions won’t sit idly by. In the next one or two years, we will see more and more traditional financial institutions launching similar services. Government bond tokens, corporate bond tokens, real estate tokens—these will see significantly increased liquidity.

Of course, there will be risks and challenges, such as standardization of technology and regulatory details. But the big picture is already clear: the integration of traditional finance and blockchain is no longer hypothetical; it is happening in reality.

The key is to understand that this time is different. It’s not that crypto aims to overthrow finance; rather, the financial system is absorbing the best parts of crypto technology. This is a positive signal for the entire industry.