Blockchain's Quiet Revolution: Big Banks Embrace Tokenized Finance

BNP Paribas and HSBC have joined the Canton Foundation, the governing body of the Canton Network, expanding the network’s membership to over 30 members. The new additions follow recent inclusions of Goldman Sachs, Moody’s Ratings, and the Hong Kong Monetary Authority. The Canton Network, a privacy-focused blockchain designed for institutional finance, supports tokenization of real-world assets and promotes interoperability across different blockchain networks. The expansion underscores growing institutional interest in blockchain-based financial applications, particularly in tokenizing real-world assets (RWAs) such as bonds and commodities.

The Canton Network functions as a permissioned blockchain, enabling secure and confidential transactions. It features a “Global Synchronizer” mechanism that allows trades and settlements to occur across different networks without compromising data privacy or control. The network currently hosts over $3.6 trillion in tokenized assets. For BNP Paribas, joining the Canton Foundation aligns with its broader digital transformation strategy. The bank has been actively involved in blockchain initiatives, having previously participated in Digital Asset’s $135 million funding round. For HSBC, the move is aimed at improving liquidity in digital asset markets and supporting cross-asset transactions. The bank is also exploring blockchain applications in custody, bond issuance, and is preparing to apply for a stablecoin license in Hong Kong under the city’s new regulatory framework.

One of the key benefits of Canton is its potential to enable greater interoperability between the siloed blockchain networks currently operated by major institutions such as BNP Paribas and HSBC. These institutions already use Canton-based technology for their own enterprise blockchain networks. Canton’s public network model could allow assets created on these permissioned networks to be traded, used as collateral, or settled via Canton-based digital money. This interoperability is critical for expanding the utility of tokenized assets and enhancing cross-market efficiency.

The Canton Foundation includes a mix of banks, fintech firms, and service providers, all working under a neutral governance structure. Members include Broadridge, Tradeweb, and Digital Asset. The foundation aims to build a tokenized financial infrastructure that mirrors the trust and operational standards of traditional markets. Institutions like Tradeweb, a major bond trading venue, are particularly relevant to BNP and HSBC, as both banks have continued to issue digital bonds on their own blockchain platforms. For example, BNP Paribas hosted the first EU sovereign digital bond from Slovenia in 2024, while HSBC’s Orion platform was used for a $50 million Luxembourg state treasury note issuance.

The expansion of the Canton Network also reflects broader industry trends in institutional adoption of blockchain for real-world asset tokenization. Institutional demand for tokenized assets is increasingly shaping the crypto market’s narrative, with major players like Goldman Sachs, JPMorgan, and BlackRock exploring tokenization for equities, commodities, and fixed-income instruments. Regulatory developments are also playing a pivotal role, with the U.S. Senate recently clarifying that tokenized stocks will remain classified as securities, aligning with traditional financial regulations. These moves provide a more predictable legal environment, encouraging further investment and innovation in tokenized finance.

As the Canton Network grows, it is expected to play a key role in connecting global capital markets through a secure and interoperable blockchain infrastructure. With the backing of major financial institutions and a focus on privacy and regulatory compliance, the network is positioned to advance the integration of blockchain technology into mainstream financial markets.