Review by: Joshua Sum, Head of Product at Solayer Labs

Consider a single, borderless, 24/7 financial market where a Nebraska farmer can instantly hedge wheat futures. At the same time, a Tokyo pension fund seamlessly trades Tesla shares, all without permission, intermediaries or geographical restrictions.

This is not science fiction.

This is the logical endpoint of blockchain technology and asset tokenization, a vision that has captivated everyone from JPMorgan executives to Silicon Valley dreamers.

However, this is still a distant future. Not because we lack ideas, but because we are trying to build it on a foundation – today’s blockchain infrastructure – that is fundamentally not ready for employ on such a scale.

The tokenization paradox

The irony is almost painful. We’ve solved the difficult part: Real-world assets—stocks, bonds, commodities, and real estate—are being digitized at breakneck speeds.

No one wants to admit that we created digital stock certificates for a market that runs at the speed of a fax machine with the integrity of a back-alley dice game.

Current Layer 1 blockchains suffer from three critical failures that prevent institutional-level trading.

When infrastructure becomes a bottleneck

First, the bandwidth ceiling. These networks simply cannot handle the volume that real markets demand. When the launch of one popular asset can overwhelm the entire blockchain for hours, how are we supposed to process millions of daily transactions on thousands of tokenized assets? The numbers just don’t add up.

Secondly, delay. Long lock times and uncertain finality make effective price discovery almost impossible. High Frequency Trading? Uphill battle. Even basic arbitrage becomes a risky endeavor when speed of execution cannot be guaranteed. The result is massive, sustained slippages that make established stock markets look like Formula 1 cars by comparison.

Perhaps most damaging is unequal opportunity. The insane maximum extractable value (MEV) and sophisticated front-running and sandwich attacks that plague today’s networks create exactly the kind of market manipulation that is sending institutional investors scrambling. When sophisticated bots can systematically extract value from each trade by foggy trade ordering, it is no longer a fair market and the game is already rigged.

The true cost of technical compromises

The stakes couldn’t be higher. For institutions, this infrastructure represents an unacceptable risk profile. The possibility of a blockbuster trade failing mid-execution or being overtaken by algorithmic predators simply does not align with industry standard risk parameters. They will not invest earnest capital in systems that cannot guarantee basic execution integrity.

Related: No-code tools can unlock tokenization for institutional asset managers

For retail users, the promise of democratized access becomes a cruel joke when the playing field is structurally tilted towards users with the most sophisticated MEV extraction tools. We have inadvertently recreated the worst aspects of established finance – insider predominance and systematic exploitation – while eliminating regulatory safeguards that at least attempt to level the playing field.

Meanwhile, the window of opportunity is rapidly closing. Traditional finance is waking up to the potential of tokenization, but at the same time experiencing the current limitations of blockchain in real time. Every failed transaction, every forward transaction, and every network congestion event reinforces their skepticism about the promises of a decentralized approach.

Building the foundations your finances deserve

To realize the dream of 24/7 global exchange, we need a paradigm shift. We must build on the advancement of high-capacity networks like Solana, which have proven that scalable base layer performance is achievable, while recognizing that the extreme demands of global finance require a fresh, specialized class of infrastructure. Incremental optimization is not enough. We need a quantum leap forward in scalability.

The requirements are clear, even if the solutions are not insignificant. Performance must be a prerequisite, not an aspiration. We’re talking about networks capable of processing over 100,000 transactions per second with sub-second end times as a starting point, not some distant goal that can be achieved through workarounds.

Fairness must be designed at the protocol level. Transaction ordering must be done on a first-come, first-served basis, eliminating the possibility of malicious MEV turning every transaction into a potential victim of algorithmic predation. Ethics aside, this creates a predictable execution environment that requires earnest capital.

Perhaps most importantly, we need a seamless composability that makes the entire ecosystem feel like a unified marketplace. Assets and liquidity must move atomically between different execution environments, without the friction that currently fragments markets.

The technical architecture, including fresh execution layers natively compatible with ecosystems such as the Solana Virtual Machine, already exists to address these issues. This allows for specialization without disturbing the fluidity and dynamics of developers.

If you’re trying to rebuild global finances, incremental fixes won’t lend a hand. The current approach of layering solutions over inappropriate surfaces is like putting racing stripes on a horse and expecting it to compete at Daytona.

The dream of a 24/7 global exchange does not fail for lack of ambition. The problem is not vision; this is the basis.

The trillion-dollar opportunity in tokenized assets is real and waiting. It requires infrastructure designed from the ground up to meet the scale, speed and integrity that global finance demands. The question is not whether this future will come.

It depends on whether the blockchain industry builds the engine it truly deserves, or whether it watches established finance build it.

Review by: Joshua Sum, Head of Product at Solayer Labs.

This opinion article represents the author’s expert opinion and may not reflect the views of Cointelegraph.com. This content has been editorially reviewed for clarity and relevance. Cointelegraph remains committed to crystal clear reporting and the highest journalistic standards. We encourage readers to conduct their own research before taking any action with the company.