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Tokenization of shares has the potential to bring significant innovation to Luxembourg’s financial services sector and surely worldwide, offering opportunities to improve processes and operational efficiency in the Investment fund Sector. But today, is tokenization truly beneficial for an investment funds in Luxembourg? The answer is most probably NO – at least not within the current regulatory framework. Despite the theoretical benefits of tokenization – such as democratizing access, enhancing liquidity, and improving processes – these advantages are largely diminished in practice for the Luxembourg fund industry due to regulatory restrictions and structural limitations, and as the present moment it offers more challenges than opportunities. In this article, we will explore the potential and limitations of tokenization within Luxembourg’s current regulatory framework by examining three distinct use cases: Reserved Alternative Investment Funds, UCITS funds, and real estate assets and we will propose a potential solution, which is gradually taking place.