Assetization and the History of Finance

This newsletter is part of The Assetizer, GenTwo's thought leadership platform.

This article is part of a series examining the ideas in Assetization: Inside the Trillion-Dollar Investing Revolution (Wiley, 2026). Read parts one, two, three, four,  five and six here.

If you look at the history of finance from the very beginning, a few mega-trends jump out.

The first is democratization: as the system grows, it has always brought more access to more people. The second is the reduction of friction; the vast majority of innovations in finance have been there to reduce friction in the system. And the third is that financial engineering and technology have been the major drivers of both.

In Chapter 8 we dive into this in detail, to argue that assetization is simply another step on an inevitable arc.

Let’s look at the evidence.

Democratization and reduction of friction

Money. It begins with money. Early money — shells and beads, gold and silver, coins — was physical, and it was the first financial abstraction. It reduced friction greatly in transactions, and it enabled longer-distance trade. Paper money was a new technology that reduced friction further still: you no longer had to carry big sacks of physical money around.

Growth of the commercial system through financial engineering. Limited liability companies reduced the risk in investing in a venture, and so made it safer for more people to do so. Joint-stock companies enabled more types of investors to get involved, increasing the investor base. Stock exchanges democratized the investment process even more, opening it to more people and more locations, and giving companies exposure to more investors. With dematerialization, digital technology moved in to hyper-boost this and hyper-scale it. Still, this was generally "gated" — available to those who could afford a seat at the table.

Growth of the retail system through financial engineering and technology. The mutual fund was the big bang that opened up investing to regular folks. IRAs, 401(k)s and retirement investing opened up investing to more people still, by making it easy — often automatic — to invest, getting even more people into the markets and used to them. Discount brokers brought more democratization by lowering the cost of trading. ETFs brought even more, lowering the cost of professional portfolio management even further than funds had, and making access much easier by being traded on exchanges. And blockchain and DeFi empower individuals by eliminating — at least in theory — the middleman, providing more access and more control to users; stablecoins promise to add programmable money and more global access to stable currencies and value.

The role of technology

No one doubts that technology has been a big factor in all of this. Writing itself, after all, is a technology. And some of our earliest examples of it – for example Sumerian cuneiform – seem to have been developed for bookkeeping purposes. Paper is a technology as well. So too were the telegraph, the radio and the telephone. All of these played key roles in the evolution of finance. 

But of course it's communications and digital technologies that have had the most scaling effect. Computers handled the calculations; the internet handled the communications. Together they lead to a fully dematerialized system, with instantaneous global transactions, trading and dissemination of financial information. Then comes blockchain, which decentralizes and democratizes, and offers a better way to settle and reconcile. And now AI, which is going to automate much of the work and expand access to knowledge.

Why this is relevant for assetization

Looked at from this lens, assetization can be seen as just another part of a wider story. The same forces of financial engineering and technology that shaped the rise, scaling and democratization of commercial and retail finance are now coming for the investment industry. They are driving the democratization of access to assets, and of the tools of financial product creation we talk about in the book. The dynamic is the same as we've seen time and again in the past.

Which is why we think it's fairly inevitable.