Morgan Stanley expects to support tokenized equities in Q1 2027, digital asset strategy head says

Morgan Stanley now views the first quarter of 2027 as a more realistic timeline for supporting tokenized equities on its alternative trading system (ATS), according to Amy Oldenburg, the firm’s head of digital asset strategy.

During an interview with The Block at Token2049, Oldenburg said the bank’s team is actively building the necessary infrastructure and expects to be in a position to support the activity by Q1. She described that window as more realistic than the second half of 2026 she previously indicated earlier in March.

"We need product in order to be able to support them within the ATS," Oldenburg said. "And the client demand really isn't there because the product doesn't exist. So we just need a little more time to pass."

The Morgan Stanley executive pointed to DTCC's upcoming tokenization service launch at the end of this month as a significant milestone that could encourage more activity in the market. She also mentioned the GENIUS Act coming into effect in January as another development the firm is closely watching.

"For us, but also for clients, it's pretty hard for anyone on the institutional side to engage," Oldenburg said. "Permissibility from the Fed is also [a factor] with Clarity not going through. It's okay that it didn't go through, but we do need to just tighten up some of the other elements of Clarity that are still less defined for traditional organizations."

Oldenburg said supporting tokenized equities through its ATS, which matches orders outside of public exchanges like the Nasdaq, fits the firm’s strategy of "raising, allocating, and managing capital onchain while helping clients navigate a hybrid world." 

The firm already offers clients direct equities, derivatives, and swaps through the same model and views tokenization as an extension of that model, she said. Remaining vehicle-agnostic allows the bank to support clients who may hold exposures across both traditional and onchain formats.

'Securitization of everything'

This is part of Morgan Stanley's efforts to expand its clients' reach onchain. The firm is developing proprietary wallet infrastructure that is not non-custodial but designed to be abstracted away from users while allowing them to hold tokenized assets and products.

Separately, Morgan Stanley recently established a Digital Asset Lab to test blockchain and crypto-native technologies required to support new products, rather than the products themselves. Oldenburg said the lab provides a secure environment in which the firm can examine risks and opportunities before anything moves into production. 

"If it's perpetuals, prediction markets, any of these newer products, I'm not saying that we're going to do any of those, but if the clients are interested, if the consumer wants them, and there's an opportunity there, we have to be able to support those," Oldenburg explained.

The bank also received a conditional approval from the OCC earlier this year to establish a digital trust to custody or stake digital assets on behalf of its clients.

On further growth areas in tokenization, Oldenburg said operationally complex areas, such as private shares, structured notes, custom products, and private fund access, are near-term opportunities, where blockchain could reduce paperwork and administrative burdens. Once more assets are tokenized, she said, questions arise about using them as collateral. She summarized this trajectory as “the securitization of everything."

When asked about predictions that the tokenized real-world asset market will reach $3 trillion to $10 trillion, Oldenburg said, "We'll definitely be within that range without question."

"Even in the last 12 months, everyone has just been going crazy with announcements," Oldenburg told The Block. "Energy drives energy across our industry. There's a lot of FOMO in the institutional space."