Morgan Stanley: Tokenization and 24/7 Markets End Traditional Banking Hours
In brief
- Morgan Stanley leaders declare traditional 9-to-5 banking ending as markets shift to 24/7 operations with real-time settlement
- Tokenization accelerates the shift, improving cash mobility and collateral efficiency for institutional investors
- Morgan Stanley launched spot crypto ETFs and expanded tokenized products including money market funds and stocks
- Infrastructure modernization will take years as firms transition to blockchain-based financial activity
The End of Banker Hours
Betsy Graseck, Morgan Stanley's global head of banks and diversified finance research, framed the transformation plainly: "I do phrase it as, look, this is the end of banker hours. Your batch processing mentality is going to be a thing of the past." She argued that banks, exchanges and custodians are investing in technology that allows assets to move 24 hours a day, seven days a week, rather than only during traditional market hours.
Graseck warned that firms ignoring the tokenization trend risk falling behind as more financial activity migrates onto blockchain-based infrastructure. The shift isn't theoretical — it's already underway. Morgan Stanley launched its first spot bitcoin ETF earlier this year, followed this week by spot ether and solana ETFs. The firm also began offering spot trading in bitcoin, ether, and solana through its E*TRADE platform.
Tokenization Unlocks New Opportunities
Institutional investors are pursuing tokenization for concrete reasons. Graseck stated that investor demand is focused on tokenization for its ability to improve cash mobility, increase collateral efficiency, and create new investment opportunities. The benefits aren't limited to large players — tokenized products are expanding rapidly at the retail level too.
Denny Galindo, Morgan Stanley Wealth Management investment strategist, noted that tokenized money market funds and stocks have expanded rapidly this year. He predicted they will introduce many investors to blockchain technology before they ever buy a cryptocurrency. This on-ramp matters. Mainstream adoption hinges on familiar products (ETFs, money market funds) arriving first on blockchain rails.
A Gradual Transition
The infrastructure shift won't happen overnight. Graseck expects the transition to take years rather than months. Yet the direction is clear: Ali Wallace, Morgan Stanley Investment Management's global head of capital markets and ETF strategy, identified growing interest in multi-currency digital asset ETFs as the next stage of innovation.
The financial industry's pivot from 9-to-5 operations to 24/7 settlement isn't a hype cycle. It's a structural response to tokenization's efficiency gains and investor demand for continuous access to capital. Banks and custodians that modernize will capture this flow. Those that don't will watch it migrate elsewhere.
Frequently asked questions
What is tokenization in finance?
Tokenization is the process of converting financial assets (stocks, bonds, money market funds) into digital tokens on blockchain networks. This enables 24/7 settlement, improves cash mobility, increases collateral efficiency, and allows assets to move across borders without traditional banking infrastructure constraints.
Why are banks moving to 24/7 markets?
Tokenization on blockchain infrastructure eliminates the need for batch processing and business-hour constraints. Banks, exchanges, and custodians are investing in technology to enable real-time settlement and continuous investor access to capital, improving efficiency and reducing friction in financial activity.
How long will the transition to 24/7 markets take?
Morgan Stanley executives expect the shift to traditional 24/7 markets to take years rather than months. The timeline depends on how quickly firms modernize their infrastructure to support blockchain-based financial activity and tokenized products.
