The era of Web3 pilots is over and Web3 elements like tokenization cryptocurrencies are set to pose a direct challenge to traditional financial systems. Aishwary Gupta, the global head of payments at Polygon Labs shared this notion in conversation with CoinHeadlines, spilling insights around the foreseeable future of the Web3 sector internationally.
Over the last one year, the U.S. joined the UAE and the EU among other regions to adopt a regulate-than-restrict approach towards the Web3 industry. As a result, the interest in exploring technologies like crypto, real world assets tokenization, and blockchain caught the attention of institutional investors.
Gupta, a chartered accountant who joined Polygon Labs in 2021 as its first full-time employee, told CoinHeadlines that the convergence of policies, technology, and finance is shaping up the road ahead for blockchain-based technologies.
Tokenization
Tokenization is now moving into an institutional scale phase, shifting from pilots to production for assets like money-market funds (MMFs), treasuries, and short-term credit instruments, Gupta said as he highlighted the brightest emerging star from the web3 space.
Tokenization is the process of representing ownership rights of a physical asset into a blockchain-based digital token. This process can improve the liquidity element of the physical assets, without compromising on its structural or value-based integrity.
Gupta said that tokenization automates compliance and shortens settlement cycles, directly challenging existing intermediaries — which is what is expected to propel it into popularity in the coming times.
“Policy convergence bringing together initiatives like Singapore’s Project Guardian, U.K.’s FCA sandboxes, and UAE’s VARA regulations can emerge as a major driver for growth in the tokenization arena. To prevent fragmentation, regulators need to establish an interoperable legal environment.
As per Coinbase’s 2025 Crypto Market Outlook report, tokenized real-world assets rose by over 60 percent hitting the valuation of $13.5 billion as of December 2024. McKinsey & Company predicts that the market cap of tokenized assets could reach about $2 trillion by 2030.
Noting that firms like Citi, BNY Mellon, and Société Générale-Forge are already issuing tokenized bonds, Web3 firms like Polygon are bringing advancing technical assistance to safeguard the process.
“UAE, U.S., and Singapore are predicted to channel $1–2 trillion in tokenized asset flows by 2030,” he said.
CBDCs
Regulated digital money like central bank digital currencies (CBDCs) are bound to play a key role in the future of the Web3 economy, Gupta said. He termed regulated digital money tokens like CBDCs as risk-free settlement assets.
“These are crucial for atomic Delivery-versus-Payment (DvP) and repo activities in tokenized markets,” he told CoinHeadlines.
International organizations like the Bank of International Settlements (BIS) with its “Unified Ledger” initiative and Hong Kong Monetary Authority’s “Project Ensemble” are presently focused on testing the use-cases around stablecoins and CBDCs.
In order to be prepared for the emergence of digital money tokens in full form, blockchain forms are already working on solutions to manage their transactions and use-cases better.
“Polygon’s Chain Development Kit, for instance, are letting banks to build permissioned rollups that interoperate with public stablecoins like USDC on Polygon. This hybrid model (regulated deposits/wCBDC linked to open-chain liquidity) is projected to be the settlement standard by 2026,” Gupta said.
At present, India and China alongside Russia, Kazakhstan, UAE, and South Korea are conducting advanced CBDC trials of their respective fiat currencies. These CBDCs are the blockchain representations of traditional national currencies.
The U.S. however, took a more stablecoin-focussed approach by signing the GENIUS Act into law earlier this year. Its CBDC plans, however, are seeing a pushback from President Donald Trump and his allies, citing financial surveillance concerns over the American citizens.
Regulations
The regulatory landscape around crypto and digital assets is undergoing a major overhaul around the world. For these digital assets to attain deep liquidity, Gupta said, overcoming technological and legal challenges needs to be top priority across nations.
In the coming times, Gupta said, financial regulators from around the world should come together and define functional equivalence between traditional and tokenized finance.
“Utilizing cross-jurisdictional license passporting, as offered by MiCA, IFSCA, and VARA sandboxes along with adopting common standards for identifiers and disclousures can eliminate legislative fragmentation across digital assets-friendly nations,” Gupta noted.
Amid the ongoing regulatory changes related to crypto, Polygon is accelerating efforts to be an early contributor to the tokenization market. Recently, Polygon Labs appointed former head of crypto at Stripe, John Egan as its chief product officer.