A strange thing happened in 2024. Tokenization stopped being a pitch deck idea and turned into something people in finance had to take seriously. You could see it in the numbers. BlackRock’s BUIDL fund passing half a billion dollars on-chain by August. Franklin Templeton reporting hundreds of thousands of blockchain wallets by the end of the year. Even central banks, usually slow to shift, running tokenized fund trials like it was routine work.
These events made one thing clear. The market wants tokenized funds, but it does not want chaos. And that is still what we have: scattered rules, unclear models and every issuer building their own setup from scratch. It feels a bit like the early days of the internet when websites didn’t agree on anything, not even how to load a page.
Lorenzo’s OTF framework steps into that gap. Not as some perfect answer, more like a strong attempt at sanity. A shared model for tokenized funds that tries to meet the real demands of global finance instead of chasing hype.
The need for this kind of structure keeps growing and look at the action from regulators in 2024 and early 2025. The EU extended its DLT Pilot Regime. Japan’s FSA pushed ahead on cross-border fund work. The U.S. SEC approved more blockchain-based transfer agents. Everything points toward a world where tokenized assets will grow whether or not the plumbing is ready. If the plumbing is not aligned, the mess will slow everyone down.
OTF tries to avoid that outcome by giving tokenized funds a clear shape. The token holds clean rights. Fund events are easy to read. Compliance rules sit inside modules instead of scattered across contracts. Nothing flashy. Just a model that doesn’t break when scaled.
Some asset managers may shrug at this. They have systems that work, even if they are slow and expensive. But those systems are struggling. The old stack depends on long chains of updates. Transfer agents, custodians, settlement desks, middle offices. Each with its own ledger. Each adding some risk. Meanwhile, liquidity now moves faster than those systems can handle.
When a fund is tokenized under OTF, the state of the fund is not hidden inside internal books. It’s on-chain. Minting, burning, transfers, reports, all tied to the same visible record. You don’t need twenty systems to confirm something that should have been clear from the start. This is not just a tech upgrade. It changes how quickly investors can access the fund, how fast errors get spotted, how clean the audit trail becomes. Many firms underestimate how much time gets wasted reconciling ledgers that never needed to diverge.
There is also the question of reach. A tokenized fund can move across borders in ways old systems struggle with. You can wrap a token for a local market. You can shift between chain environments without rewriting the entire product. That matters because growth in 2024 came from global interest, not just one region. Investors from markets with limited access to U.S. or EU funds found on-chain versions easier to reach. The demand is there, waiting.
Investors gain from this setup in more obvious ways. Faster settlement. Smaller minimums. Clear proof of what they own. Fewer hidden rules. Reports tied directly to the token instead of buried behind portals. Real-time price data when possible. These improvements may sound small, but when combined, they shift the experience from “old fund world” to something much closer to modern digital ownership.
Issuers get something different: relief from constant custom work. If everyone follows the same basic structure, they no longer rebuild the house every time they launch a product. Modules make it easier to change parts without breaking the whole thing. In an industry that spends billions each year on operational drag, this matters more than it appears.
Certain people still worry that tokenization is too early or too complex. Yet the growth we saw in 2024 shows that large institutions already crossed the line. JPMorgan’s Onyx network processed billions in tokenized collateral. HSBC expanded its Orion platform. These are not pilots that fade away. They are production systems, and the rest of the market will have to sit on rails that work with them.
That is where something like OTF becomes important. Without a standard, every new fund becomes an outlier. Hard to regulate. Hard to audit. Hard to integrate with large banks that expect clear formats. Standards do not solve every issue, but they raise the floor so everything built on top stands a little straighter.
Looking at 2025, tokenized funds are not heading for a dramatic turning point. No single event will flip the entire industry. Instead, progress will move in steps. More banks will test settlement on-chain. More asset managers will try tokenized money market funds. Regulators will ask for data formats they can actually read. And investors, who care less about the tech than the outcome, will pick the option that feels simple and quick.
Lorenzo’s OTF framework fits into that steady shift. It is not hype driven. It focuses on nuts and bolts: rights, structure, functions, compliance, reporting. Things that matter long after the excitement fades. It also respects that global finance is not built on perfect uniformity. Markets differ. Rules differ. So OTF uses modules rather than rigid templates, which gives room for oversight and innovation at the same time.
No framework solves everything. But this one addresses the problems that already slowed tokenized fund growth in 2024. Interoperability. Cost. Legal clarity. Operational noise. Issues that cannot be solved chain by chain or fund by fund. They need a shared approach.
If tokenized finance keeps growing at the pace we saw last year, frameworks like OTF will matter even more. The market is ready for scale. The systems behind it are not. And the gap between demand and structure is where the real work lies.
OTF aims to shrink that gap. Not by promising a perfect future, but by supplying the basic shape for a tokenized one.
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