APAC tokenisation push exposes banks to execution gaps

Over a quarter of executives now place digital assets at the centre of strategy.

Asia-Pacific (APAC) is emerging as a key market for tokenised finance, with stablecoins, central bank digital currencies and cross-border payment projects gaining traction as banks across the region improve profitability.

Stablecoins now account for about 7% of total cryptocurrency market capitalisation, with 97% pegged to the US dollar, according to IBM’s 2026 Global Outlook for Banking and Financial Markets.

USDT and USDC make up 90% of the stablecoin market, which IBM said is concentrated in APAC and North America.

The region is also seeing increased activity in central bank digital currencies, or CBDCs. 

Across APAC, regulators and financial institutions are running active CBDC pilots, often focused on cross-border payments, whilst approaches to stablecoins remain mixed. 

IBM said payment fragmentation, regional trade links and financial inclusion are amongst the main factors shaping adoption.
Japan is taking a cautious approach to retail CBDCs and stablecoins whilst supporting wholesale tokenisation.

China is pushing ahead with its retail e-CNY and state-led tokenisation whilst restricting private stablecoins. Australia is running wholesale CBDC pilots and supporting tokenisation, particularly in trade finance and wholesale settlement.

India is rolling out both retail and wholesale CBDC programmes whilst maintaining restrictions on private cryptocurrencies.

IBM said the country’s approach is closely linked to its digital public infrastructure and payments policy.

The shift comes as banks globally move tokenisation higher up their strategic agendas. 

IBM found that 26% of banking executives said tokenisation was now central to their strategic direction, although only 9% said initiatives were live or ready for deployment in 2026. About 71% said they faced shortages of relevant talent.

Banks are looking at tokenisation for payments, custody, liquidity management and the digital representation of financial and real-world assets. 

Amongst corporate banking executives, 71% expect revenue opportunities from faster cross-border payments and 70% see potential in liquidity and working-capital services. Around 65% expect banks to play a custody role, whilst 63% expect them to provide tokenisation services.

APAC banks are entering this transition with stronger profitability than in 2019. Median return on average equity, or ROAE, for banks in the region rose to 12.0% in 2025 from 10.0% in 2019. The median cost-to-income ratio fell to 44.4% from 51.5%, whilst the average price-to-book ratio edged up to 1.0 from 0.9.

However, credit indicators were mixed. The region’s median non-performing loan ratio increased to 1.8% from 1.6%, whilst loan-loss provisions rose 16% year on year in 2025. 

IBM said APAC banks had improved profitability overall, although market valuations remained relatively subdued.

The report is based on a survey of 500 senior banking and payments executives conducted with Oxford Economics in the fourth quarter of 2025. 

Respondents represented more than 25 markets across retail, commercial and corporate banking, asset and wealth management, and payment networks and processors.