In his annual letter to shareholders, BlackRock Chairman and CEO Larry Fink argued that digital assets and tokenization can help update the financial system, even as he warned that the U.S. economic model is leaving too many people behind.
Fink said in the letter that the current system has delivered most of the benefits to those who already own assets, while many workers have been excluded from market growth. He linked this imbalance to broader problems in the United States, where rising inequality, high government debt and low participation in capital markets have put pressure on old financial models.
“Capitalism is working, just for enough people,” Fink writes.
The solution he proposes centers around tokenization and digital issuance as tools to expand investment opportunities and make markets work better.
Fink said tokenization could “renew the pipeline of the financial system” by making investments easier to issue, trade and access.
The idea is simple: Transferring fund shares, bonds or other securities could become faster and cheaper if asset ownership was recorded on a digital ledger. In effect, this would allow regulated digital wallets to hold not only payments but also fractional interests in assets such as tokenized bonds, ETFs, and infrastructure or private credit.
“Half the world’s population has a digital wallet on their phone,” Fink writes. “Imagine if the same digital wallet also allowed you to invest in a wide range of companies over the long term – as easily as sending a payment.”
Fink compared tokenization today to the Internet in 1996, arguing that it will not replace traditional finance overnight, but can gradually connect old and new systems. He said policymakers should focus on building the bridge “as quickly and safely as possible” and called for clear buyer protections, counterparty risk standards and digital identity checks to reduce illicit financial risks.
The comments further push BlackRock into a broader push into digital assets. In the same letter, Fink said the company has established “early leadership” in the space and cited nearly $150 billion in assets related to digital markets.
BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) is the world’s largest tokenized fund, and the company also manages $65 billion in stablecoin reserves and nearly $80 billion in digital asset exchange-traded products.
Still, much of the letter focuses on deeper stresses in the U.S. financial system. Fink warned that banks, businesses and governments can no longer fund a massive economic transformation on their own, especially as the country tries to rebuild manufacturing capabilities, expand energy supplies and compete in artificial intelligence.
He also believes that Social Security remains an important safety net, but may require structural reforms, including some level of long-term market returns, to remain sustainable.
For Fink, tokenization is part of a bigger picture. It’s not a bet on hype, it’s a bet that better rail can help more people become investors rather than spectators.
His broader message is that finance needs an upgrade, and digital assets could be part of that overhaul.