Crypto Was the Experiment. Now Wall Street Is Taking the Best Parts

The first decade of crypto can be seen as a sequence of bubbles, hacks, memes, and projects that disappeared almost as quickly as they appeared.  I see a decade of financial experimentation. 

An open, global laboratory operating 24/7, with an unusual combination of innovation, speculation, fraud, successes, and failures. 

Not everything created in that environment will survive. In fact, most of it will not. But what survives will change the way the financial industry operates. 

What Has Survived So Far

Some of the mechanisms first tested in crypto are already being adapted and incorporated by traditional finance: faster settlement, programmable assets, continuous markets, new forms of collateral, automated market makers, contracts without expiration, and the ability to combine different financial services within the same infrastructure. 

The fight is not between crypto and traditional finance. It is over the financial infrastructure that will emerge from their convergence. 

The task is to absorb, adapt, and evolve the innovations that work — without importing the risks and deficiencies of the original laboratory.  

Crypto Tested What TradFi Couldn’t At the Same Speed 

In the more open and less regulated parts of crypto, the industry operated as an open-air laboratory. For better and for worse. 

Protocols could be launched quickly. Users could test products without going through long institutional approval cycles. Markets could operate continuously. Developers could combine different applications and build new structures on top of existing contracts. 

Some experiments were useful. Others were fragile. Many were simply speculation with a layer of technology on top. 

But even failed experiments helped answer questions that traditional finance rarely gets to test at the same speed: What happens when settlement is effectively continuous? How does a market work without a central exchange? 

Can collateral management be automated? What happens when a financial contract can execute certain conditions on its own? How does liquidity behave when any participant can create a pool? 

Crypto did not invent every financial innovation of the last decade. But it was where many important ideas could be tested before being accepted by traditional finance. 

Automated market makers, or AMMs, are one example. Instead of organizing trading through a central limit order book, an AMM uses liquidity pools and a formula to determine relative prices between assets. One participant supplies liquidity to the pool; another trades against that liquidity; and the contract executes the transaction automatically. 

The mechanism has obvious advantages. It can operate without a traditional dealing desk, integrate with other protocols, and allow an exchange transaction to be executed directly on the network’s infrastructure. 

But it also has known problems: manipulation risk, exposure to execution order and front-running. 

That combination is precisely what makes the laboratory interesting. Innovation does not appear separately from risk. It appears together with risk. 

The market’s job is to determine whether a mechanism can be redesigned, regulated and used in an environment where risks and responsibilities are understood and managed. 

The same logic applies to other experiments: global markets operating 24/7, perpetual futures, stablecoins, tokenization and composability. Not all of these formats will be transferred directly to banks or exchanges, but the benefits they bring are clear.

Convergence is Not a Conversion of Faith 

For a long time, the debate was framed as a conflict between two incompatible systems. 

On one side, traditional finance: slow, expensive and excessively intermediated. On the other, crypto: fast, global, open and decentralized. 

That polarized analysis is unhelpful because it turns a question of architecture and incentives into a question of identity. 

Traditional finance has real challenges. Fragmented systems create reconciliation work, delays, operating costs and dependence on multiple intermediaries. 

At the same time, it carries functions that are essential to a well-functioning market: governance, the legal definition of ownership, controls, custody, investor protection, the prevention of illicit activity, risk management and mechanisms for operating through periods of stress. 

Crypto, in turn, showed that some of these functions can be performed differently. It also showed the cost of ignoring others. 

Convergence, therefore, will not be a conversion of traditional finance to crypto — or the other way around. It will be a selection process. 

The market will absorb whatever solves concrete problems: 

• Faster settlement 

• Programmable assets and money 

• Process automation 

• Continuous operation 

• New forms of margin and collateral 

• Greater interoperability

• Global distribution

• Fewer reconciliations and manual steps. 

At the same time, those solutions will have to work with governance, legal certainty, compliance and risk management. 

This is the least exciting part of the narrative, but it is what will determine how convergence takes place. A protocol can be technically elegant and economically irrelevant. An asset can be tokenized and remain illiquid. A transaction can settle instantly and still carry credit, counterparty, or ownership risk. 

Tokenization does not turn a bad asset into a good one. It only changes how that asset is represented, transferred, and potentially integrated with other processes.

The Problem is Not Just Digitization. It is Integration. 

The last four decades have been defined by the transition from an analog system to a digital one. 

Records stopped being physical. Orders became electronic. Communication became faster. Information began to circulate at a speed that would have been difficult to imagine at the beginning of my career. 

But digitization does not mean integration. 

Financial infrastructure is still made up of different systems that need to communicate with one another. A transaction can pass through trading, confirmation, messaging, clearing, custody, ownership registration, money transfer and reconciliation. Each stage can be digital and the process as a whole can still remain fragmented. 

That is where tokenization may be more important than the simple creation of new assets. 

The BIS describes tokenization as recording rights to real or financial assets on a programmable platform when those rights previously existed on a traditional ledger. 

The potential lies not only in creating a digital representation. It lies in combining messaging, reconciliation, and asset transfer within the same operation. 

In practice, this could allow money, a financial asset, and contractual conditions to coexist in the same environment. An asset transfer could be conditional on payment. Collateral could be adjusted automatically. 

A financing transaction could incorporate margin rules. A distribution could be programmed according to predefined criteria. 

The most important change, therefore, may take place in the rails and plumbing of the financial industry. 

Not only in the assets that appear on an investor’s screen, but in the infrastructure that allows those assets to be issued, traded, financed, collateralized, transferred, and settled. 

The Internet is a Good Example 

The internet also began surrounded by experiments, fragile business models, and exaggerated expectations. 

Many companies disappeared. Some ideas looked promising but never found an economically sustainable application. Others were absorbed by companies that did not even exist when the technology was first being developed. 

What remained was not a list of the first projects. It was the protocols, connectivity, distribution and, above all, the behaviors that the new infrastructure made possible. 

The analogy with crypto is useful for that reason. The value of the first decade does not have to lie only in the tokens and companies that dominated the previous cycle. It will lie in

the mechanisms that survive the market’s test. 

Meme coins, NFTs, lending protocols and different exchange models were part of that process. Some will remain niche products. Others may disappear. Many will be rebuilt in regulated environments and integrated into the existing financial industry. 

The point is not to predict which token will rise or fall. It is to understand which economic functions will continue to make sense once they are subjected to scale, governance, regulation, and liquidity. 

That distinction matters to anyone investing, building products or setting strategy at a financial institution. Technology can be useful without the token associated with it capturing value. 

A protocol can generate volume without generating sustainable returns for its participants. An application can be innovative and still fail to find product-market fit. 

In finance, utility is not enough. You need to understand who pays, who captures value, who takes the risk, and what happens when the incentive disappears or something goes wrong. 

The Transition Creates Opportunities and Destroys Established Positions 

The biggest opportunities tend to appear when infrastructure changes. 

That was true of the internet. It was also true in other technological and financial transitions: when the old standard still dominates, but the new standard is beginning to alter costs, behavior and business models. 

The problem is that transitions also destroy established positions. 

Companies that depend on a long chain of intermediation may lose relevance if certain steps become automated. Professionals who only execute repetitive processes may be replaced or see their work reconfigured. 

Institutions that treat digital assets as an isolated category may discover too late that the technology has begun to affect traditional products such as payments, funds, foreign exchange, credit, custody and capital markets. 

On the other hand, it is not enough to learn how to code a smart contract or understand the mechanics of a blockchain. The next phase will require a combination of market knowledge, technology, regulation, risk and distribution. 

The next generation of financial professionals will not be defined only by their ability to trade an asset or use a tool. It will be defined by their ability to understand the interaction between the asset, the infrastructure, and the rules that make an operation possible at scale. 

That is one of the subjects I intend to follow in this column: not only what changes in markets, but which business models and skills become valuable when infrastructure changes.

The Challenges 

It would be a mistake to turn this thesis into a narrative of inevitable progress. 

Institutional adoption of tokenization is still limited. Many projects remain in testing. Secondary-market liquidity is insufficient for a range of applications. Interoperability between networks has not been solved. Legal and operational standards are still being built. 

Regulation has also advanced unevenly. 

Many applications do not solve a meaningful problem. They were created because they could be created, not because there was sufficiently strong economic demand. It is a solution looking for a problem. 

That is why the thesis does not depend on the entire crypto industry surviving. It depends on some of the mechanisms developed in that environment proving useful enough to be absorbed by regulated and economically sustainable structures. 

The filter will be tough. 

The next decade will probably be less about choosing a side and more about understanding which rails will carry money and assets. 

That is where the change happens.