CME and Google Cloud Face Criticism Over Tokenization Project

CME Group has teamed up with Google Cloud to explore tokenization in capital markets through the Google Cloud Universal Ledger (GCUL). The goal is to improve how assets and payments move across financial systems by using a private, permissioned ledger. While the project is still in its early stages—with testing set for later this year and a launch planned for 2026—it’s already drawing criticism from the blockchain community.

GCUL is a distributed ledger designed for easy use by financial institutions. It promises simpler asset management and more secure transactions. Terry Duffy, CEO of CME Group, praised the partnership, saying it could bring real improvements to collateral, margin, settlement, and payment processes, especially as the world moves toward 24/7 trading.

Initial testing and integration are already complete, and direct testing with market participants is expected later this year. But despite the promise of efficiency, many crypto experts are pushing back against the idea. They argue that GCUL’s centralized and permission-based model clashes with the open and decentralized nature that defines blockchain technology.

Some on social media say the move is not a good sign for the industry. One analyst described the situation as a battle between public decentralized networks and private chains. He warned that using a closed system like GCUL could weaken key blockchain values like transparency and accessibility.

“Not bullish at all,” said another critic, who emphasized that GCUL is private and not open to everyone. This, they argue, makes it no better than traditional systems that blockchain was supposed to replace.

Still, others point out that real-world financial markets have needs that public blockchains can’t easily meet. For example, systems like CME Group often require extremely fast settlement speeds and the ability to manually adjust transactions when needed. This is difficult to achieve on public networks, which operate with automatic and irreversible transactions.

To meet these demands, institutions often divide blockchain nodes into different roles—such as for clearing, compliance, and monitoring. According to one expert, public chains don’t allow for this level of control, which is why many large players prefer private solutions.

There are also concerns about security and regulation. If real-world assets are tokenized and traded on decentralized platforms, there could be risks related to speculation, illegal activity, and lack of oversight. That’s why many traditional finance professionals remain cautious about decentralized exchanges (DEXs). One analyst even said some in the industry view DEXs as similar to black markets.

Another issue is liquidity control. In traditional finance, it’s important to keep tokenized assets within certain limits to prevent price manipulation or other risks. On open public blockchains, it’s harder to enforce those boundaries.

These concerns show why financial giants might prefer systems like GCUL. They offer more control, faster processing, and compliance options—all of which are vital in high-stakes environments. Still, the backlash reveals a larger debate over the future of tokenization: Should it be built on public, decentralized platforms, or private, permissioned systems?

While CME and Google Cloud push forward with their initiative, this discussion is far from over. As the launch date approaches, the tension between efficiency and decentralization will likely grow stronger—especially as both sides of the debate seek to shape the future of financial technology.