The token supercycle: everything of value is becoming programmable

Value is becoming programmable.

Markets went electronic. Money went digital. Finance moved onto the internet. Each of those shifts changed how we trade, pay and invest without changing what an asset is. This one changes the asset.

The Token Supercycle is the long-term migration of money, assets and ownership onto always-on internet infrastructure. Read it merely as a market rally, and you will miss the larger transformation.

The internet capital market it produces will become the largest capital market.

Lily Liu is the president of Solana Foundation.

Supercycles restructure markets

In the early 2000s, China industrialized fast enough to push commodities into a multi-year structural boom. Economists called it a supercycle: a long-duration shift in supply, demand and capital allocation that outlasts ordinary business cycles. The US had one in the late 1800s; Europe and Japan in post-war reconstruction.

Those shocks entered the market from one side and worked through it. Tokenization enters from three. It changes who can issue, who can invest and who can distribute, at the same time, across the globe.

Four forces developed on separate tracks and have now converged:

• Stablecoins proved money can move onchain at a global scale.
• Financial institutions are bringing assets onchain.
• Blockchain infrastructure can now support the speed and cost that real economic activity requires.
• AI is producing a new class of economic actors that needs programmable money to function at all.

Any one of them is a technology cycle, but together they are something else. It should be possible to issue a token for anything of value. To hold a clear title to it. To finance against it. And to trade it in a market that never closes.

Issuers: distribution is valuation

Legacy systems were designed when information sharing and value transfer were both high friction. Both constraints are gone, but the market structure they produced is still here.

As a result, liquidity is fragmented. There are excellent assets in every market that never reach the capital willing to own them, because that capital sits in a different regulatory perimeter or a different size bracket.

Tokenization opens the aperture. Geography stops being a gate: an asset issued anywhere has the potential to be distributed everywhere, instantly, at any hour. Check size stops being a gate, too, as markets built for institutional tickets can now extend into sub-institutional ones with minimal cost.

The proof of concept is a century old. An ADR wraps a foreign share so US investors can buy it, and issuers have used them for one reason: access to a deeper pool of capital raises the price of identical cash flows. The mechanism and rationale are established. It is simply expensive and narrow, requiring a depositary bank and a sponsor.

The internet made information nearly free to create and distribute. What followed was not newspapers online. It was entire markets and business models with no prior analogue. Tokenized Treasuries are the newspapers-online phase: a useful demonstration, but also not the endpoint. Five and a half billion people are connected to the internet. Financial infrastructure that can reach all of them, at any hour, with any asset, brings the biggest market of all — the market for money — to fingertip access. Putting global liquidity online is too strong a gravitational pull to resist.

Unbounded markets

Every capital market to date has been bounded by who could get in: exchange floors, brokerage relationships, jurisdictions and opening hours. The internet capital market begins to loosen those boundaries.

The system that captures that shift will not be an upgrade of the old one. It is being built now, one token at a time.

Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates.