WASHINGTON, July 15, 2026 /PRNewswire/ — The tokenization of securities has evolved greatly over the past year, and a new paper from the Investment Company Institute (ICI), Tokenization: An Asset Management Perspective, examines the issue specifically through an asset management lens. The paper focuses on the implications and opportunities for registered funds and their investors.
ICI supports the responsible integration of tokenization into financial markets, provided that associated risks are managed prudently. Effective regulation should be fit-for-purpose, durable, and adaptable to technological innovation so that it encourages continued progress without compromising investor protection.
In order to advance the debate about the best way to integrate tokenization into regulated funds, ICI has conducted an impartial analysis of emerging models for the tokenization of funds and securities and their potential impact on a variety of aspects of fund operations, distribution, and regulation, identifying both potential benefits and concerns.
ICI’s analysis focuses on two levels of potential impact: the tokenization of shares offered by investment funds, such as mutual funds and ETFs; and the tokenization of the assets in which investment funds invest on behalf of their investors. It also sets out principles for policymakers as they evaluate tokenization in capital markets and develop appropriate regulatory frameworks.
“Tokenization has the potential to change how investors access and experience financial markets, but innovation must be built on a strong foundation of investor protection,” said ICI President and CEO Eric J. Pan. “As policymakers consider this exciting technology, they should keep investors at the center and ensure that tokenization strengthens, rather than weakens, the protections that have long supported confidence in regulated funds.”
For more than 85 years, the Investment Company Act of 1940 has protected retail investors while evolving alongside capital markets. Tokenization presents another opportunity for that framework to evolve with new technology while maintaining its foundational protections.
“Fund regulations need to adapt to address advances in tokenization and blockchain technology,” said ICI General Counsel Paul Cellupica. “As tokenization models continue to develop, policymakers should ensure that securities laws apply clearly and consistently, while giving regulated funds room to innovate responsibly. The goal should be a regulatory framework that supports new market infrastructure without weakening investor safeguards that have long been at the core of successful regulated funds.”
Regulated funds have generated substantial benefits for investors, issuers, and the broader economy by directing capital to productive uses and helping investors participate in economic growth as they pursue their financial goals. ICI sees tokenization as a potential next chapter of that progress. As policymakers consider tokenization‘s role in capital markets, they should build on asset management’s enduring strengths and create the conditions for responsible innovation and continued progress.
Read ICI’s full paper here.
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SOURCE Investment Company Institute
