For much of the past decade, financial institutions discussed tokenisation primarily as a new way to issue assets. A bond, fund share or security could exist on a distributed ledger rather than within conventional record-keeping systems, which promised faster settlement and more automated administration. In 2026, however, much of the industry’s attention has shifted towards what happens after an asset has been tokenised, because banks, asset managers and market infrastructures increasingly want those instruments to move between institutions, satisfy margin requirements and serve as collateral without first returning to conventional settlement rails.

Creating a digital representation of an asset delivers only part of the potential efficiency if investors still have to move it through several intermediaries whenever they want to pledge it, finance it or use it to settle another transaction. Collateral markets provide a more demanding test because institutions care not only about proving ownership but also about legal certainty, transferability, liquidity and whether an asset can move quickly enough to meet obligations during periods of market stress.

Large financial institutions are therefore building systems that allow tokenised government bonds, fund shares and other financial instruments to move between participants inside digital settlement environments. The emerging model does not depend on inventing an entirely separate category of financial asset; instead, institutions are beginning to combine established securities with new ownership and settlement infrastructure, while maintaining the legal and economic characteristics of the underlying instrument.

Money-market funds provide an especially useful bridge between conventional finance and blockchain settlement because investors already use them as highly liquid cash-management instruments. Tokenised share classes can connect those funds directly with digital financial networks, allowing institutions to use fund interests more flexibly for treasury management, collateral transfers and settlement. The advantage therefore lies less in converting a familiar fund into a token than in allowing the same asset to circulate inside a more programmable operational system.

Collateral mobility also exposes one of the weaknesses of conventional market infrastructure. Financial institutions frequently hold sufficient high-quality assets to satisfy obligations, yet moving those assets between custodians, clearing houses and counterparties can require several operational steps and restricted settlement windows. A digital asset that can transfer almost continuously gives treasury teams greater flexibility to allocate collateral where it is needed, particularly when market conditions change quickly.

That flexibility becomes more valuable as financial institutions face growing demands for intraday liquidity. Clearing systems increasingly require participants to manage exposures throughout the trading day rather than waiting for an end-of-day settlement cycle, while derivatives and secured-financing markets can generate sudden collateral requirements when asset prices move. Tokenised collateral cannot eliminate those obligations, but it can shorten the distance between identifying a liquidity need and moving an eligible asset to satisfy it.

The remaining obstacles are partly technical but predominantly institutional. Financial firms need interoperable settlement systems, recognised custody arrangements and reliable mechanisms for establishing which version of an asset constitutes the legally authoritative ownership record. They must also coordinate the cash side of transactions, because near-instantaneous securities settlement offers limited benefit when the corresponding payment still moves through slower banking infrastructure.

Digital deposits and regulated stablecoins may eventually solve part of that mismatch, although financial institutions have not settled on a single model. Banks, payment companies and blockchain providers continue to develop different forms of digital cash, while jurisdictions are creating regulatory frameworks at different speeds. As securities become easier to move digitally, inefficiencies elsewhere in the transaction chain become harder to ignore because the slowest component increasingly determines the speed of the entire transaction.

Interoperability presents a similar challenge. A bank may create an efficient tokenisation platform for its own clients, yet the value of the system declines if another institution uses an incompatible network and assets cannot move easily between them. The next stage of infrastructure development will therefore depend less on proving that individual blockchains work and more on establishing standards that allow assets, cash and information to travel across institutional boundaries.

Investors following blockchain infrastructure should consequently look beyond the nominal value of assets that institutions have tokenised and pay closer attention to how frequently those assets actually circulate. Issuance demonstrates that financial institutions can represent conventional assets on distributed ledgers, whereas collateral usage, financing and settlement reveal whether the technology has begun to replace operational functions that previously depended on separate market infrastructure.

---

BTRUSTOR

Category: Estate & Succession Planning — Succession Frameworks

What Happens If The Founder Cannot Make Decisions?

Family succession plans commonly revolve around an event everyone can anticipate even if nobody knows its date: ownership eventually passes from one generation to another. Incapacity creates a more awkward problem because the founder may remain the legal owner of a business while losing the practical ability to exercise the authority attached to that ownership. Families that have prepared carefully for inheritance can therefore discover that they have no workable arrangement for the months or years before inheritance actually begins.

The exposure is particularly pronounced in founder-led businesses because formal ownership rarely captures the full distribution of power. The founder may approve large payments, maintain the principal banking relationships, control voting rights, chair the board and hold important relationships with advisers, customers and senior executives. If illness or an accident removes that person abruptly, the company does not merely need a future heir; directors and family members need to know who can act immediately, which decisions that person can legally make and where the limits of that authority lie.

A conventional will cannot solve the incapacity period because it governs an estate after death. Families instead need to examine several overlapping authorities, including who can exercise shareholder rights, who can make personal financial decisions for the founder, whether another director can bind the company, how trusts or holding companies operate if a settlor or protector loses capacity and which individuals can communicate with banks and investment managers.

The legal instruments vary by jurisdiction, which makes internationally structured families particularly vulnerable to assuming that one document solves every problem. Powers of attorney can cover certain financial decisions, for example, although their scope, recognition and activation differ between legal systems. A document prepared in one country may not give an attorney the same authority over a company, investment account or property situated elsewhere, especially when banks or corporate registries apply their own procedural requirements.

Families therefore benefit from mapping authority by function rather than treating a single general instruction as sufficient protection. A practical map might identify who can operate private bank accounts, who can exercise voting rights in a holding company, who can appoint or dismiss directors, who can instruct investment advisers and who can authorise exceptional business expenditure. When several jurisdictions or legal entities are involved, each layer may require a different mechanism.

Governance adds another complication because legal authority does not automatically provide strategic guidance. A founder may appoint someone to act while leaving no framework explaining which decisions that person should take independently. A power of attorney cannot determine whether the family should sell a business, whether one child should become chief executive or whether capital should be distributed rather than reinvested. Families reduce that ambiguity when they document strategic principles while the founder can still explain them and when boards understand which decisions belong to management, shareholders, trustees or family governance bodies.

The same review often exposes key-person dependencies that have little to do with formal succession documents. Passwords may sit with one individual, investment advisers may take instructions only from the founder, a holding company may require a particular signature combination or a private business may operate under shareholder agreements that assume the founder will always participate. These arrangements can function for decades until incapacity turns an informal habit into an operational obstacle.

Banking relationships deserve particular attention because financial institutions have their own duties when a client’s capacity becomes uncertain. Even where a family member believes that an existing mandate should allow a transaction, the bank may require additional evidence or legal documentation before acting. Families that address those procedures in advance can reduce the risk of discovering during a crisis that the person expected to manage liquidity cannot actually access the relevant accounts.

Business continuity also depends on the people around the founder. Senior managers may understand how the company operates but have little clarity about the family’s intentions, while family members may understand ownership objectives without knowing enough about daily operations to intervene safely. A board that contains experienced independent members can create an additional layer of continuity because directors can oversee management without immediately forcing the family to settle every long-term succession question.

Families can test their preparation through practical scenarios rather than reviewing documents in isolation. Who would approve payroll tomorrow if the founder were unconscious? Who could vote the shares next month? Who would speak to lenders during a covenant negotiation, and who could replace a director if the founder remained alive but unable to act? Where those questions produce hesitation, the succession plan contains a gap even if the wills, trusts and tax structures are already complete.

The current generational transfer of privately owned businesses makes these questions more pressing because many founders are preparing for succession while continuing to exercise extensive personal control. Planned succession gives families time to develop successors, redistribute authority and adjust governance, whereas incapacity compresses similar decisions into a period when the person who previously resolved ambiguity may no longer be available.

Death eventually transfers ownership. Incapacity may leave ownership exactly where it is while removing the individual around whom the entire decision-making system was designed, which is why continuity planning needs to address authority, access and governance as carefully as inheritance.