The lines between traditional stock markets and the world of cryptocurrencies are rapidly blurring. In an unprecedented surge of activity, major trading platforms simultaneously launched services enabling users to trade tokenized versions of U.S. stocks around the clock.
A Landmark Day for Digital Assets
On a single day in late June, the online brokerage Robinhood, along with leading crypto exchanges Bybit and Kraken, announced the launch of tokenized U.S. stock trading. This move signifies a major step toward merging conventional equity markets with the innovation of blockchain technology.
According to reports, Robinhood unveiled a new service for European Union users, built on the Arbitrum network. This initiative supports trading for over 200 U.S. stocks and ETFs, including giants like NVIDIA, Apple, and Microsoft. On that same day, Bybit and Kraken introduced "xStocks" – tokenized stock products provided by the Swiss-regulated asset tokenization platform Backed Finance. Their initial offering covers approximately 60 different stock and ETF tokens.
Adam Levi, Co-founder of Backed Finance, captured the significance of the moment: “xStocks represents a giant leap for the democratization of access to financial markets.” He added, “By bringing familiar assets onto the blockchain with unprecedented accessibility, we are not just bridging traditional finance and DeFi; we are building the foundation for a truly open, efficient, and inclusive global financial system.”
These tokenized assets are backed 1:1 by real shares and enable trading at all hours. Robinhood’s service currently operates 24/5 (24 hours a day, five days a week) with plans to eventually expand to full 24/7 trading. The news catalyzed a significant market response, driving Robinhood's stock price to a record high with a surge of nearly 10%. Company executives also revealed plans to launch tokens linked to private company shares, starting with Sam Altman’s OpenAI and Elon Musk’s SpaceX.
Divergent Technical Approaches
The strategies employed by these three platforms reveal different models for entering the tokenized stock arena.
- Bybit and Kraken (Third-Party Issuance Model): These crypto exchanges act as trading venues, integrating tokens issued by a third party—Backed Finance. These tokens are deployed on the Solana blockchain, enabling on-chain transfers and integration with decentralized finance (DeFi) applications. Users can trade 24/7 and are entitled to corresponding economic rights, such as dividends. In this model, the primary regulatory compliance responsibility falls on the issuer (Backed Finance). The exchanges themselves typically do not hold securities licenses, and these services are generally not offered to users within the United States.
- Robinhood (Licensed Broker Self-Build Model): Robinhood is taking a different path, leveraging its existing status as a licensed brokerage. It is directly issuing stock tokens on the Arbitrum network while also custoding the underlying assets. Reports indicate broader ambitions, with plans to launch its own Layer 2 blockchain, the "Robinhood Chain," aiming for a fully integrated on-chain process for issuance, clearing, and settlement.
The CEO of Robinhood emphasized the transformative potential at a launch event in France, stating, “Tokenization will unleash a revolution in mass-market trading.” The company aims to expand its offering to "thousands" of tokenized stocks by the end of the year and progressively move toward uninterrupted 24/7 trading.
A More Favorable Regulatory Landscape
The concept of tokenized stocks is not entirely new. Previous attempts, such as through the Mirror Protocol, gained brief traction but ultimately faded due to regulatory pressures and market volatility. The current resurgence is fueled by significant advancements in the regulatory framework for Real-World Assets (RWA). Traditional financial institutions, led by giants like BlackRock, alongside crypto-native firms, are actively engaging with regulators to shape a conducive environment.
Following the recent U.S. election, expectations for a more relaxed regulatory approach toward digital assets have grown, potentially making tokenized stocks a major focal point. A report from Guosheng Securities highlighted that Coinbase is also seeking approval from the U.S. Securities and Exchange Commission (SEC) to offer tokenized stock trading. According to industry reports, the company has submitted a pilot application. Receiving a no-action letter or an exemptive order could position Coinbase as one of the first compliant platforms to launch such a service in the U.S.
Experts cited in reports believe tokenized stocks could fundamentally reshape the securities investment landscape. By merging the benefits of traditional finance with those of crypto trading—such as enhanced market access, flexible trading hours, and lower costs—these assets are attracting keen interest from international investors.
Furthermore, tokenized stock services not only broaden the asset allocation channels for cryptocurrency investors but also present a powerful new use case for stablecoins. Acting as the on-chain equivalent of fiat currency, stablecoins serve as essential infrastructure tools for facilitating trades within tokenized stock markets. Analysts project that the immense scale of the U.S. stock market could be a primary driver for rapid expansion in stablecoin demand.
A Trillion-Dollar Future on the Horizon
The potential market is vast. According to a McKinsey forecast, the market for moving real-world financial assets onto blockchain could reach $2 trillion by 2030. Early success is already visible in the tokenization of simpler assets like U.S. Treasuries, a market led by firms such as Securitize and Ondo that has already reached a multi-billion dollar scale.
The recent political shift has bolstered expectations for a more supportive regulatory environment. Key figures like SEC Crypto Hub lead Hester Peirce have voiced support for tokenization, suggesting the use of "sandbox structures" for pilot programs. This would allow innovative companies to test new models in the market quickly under temporarily relaxed rules.
There is clear demand from the crypto community. As Wyatt Lonergan of VanEck Ventures noted, crypto-native investors "want the safety of an asset like Apple stock within their digital ecosystem," especially during periods of high volatility in crypto markets. For the average U.S. investor, however, features like fractional share trading and next-day settlement are already standard, leading to questions about the scalable demand for a tokenized alternative.
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Significant Challenges Remain
Despite the optimistic outlook, tokenized stocks face considerable hurdles. A late-June report underscored that a primary challenge in the United States is the lack of regulatory clarity. This ambiguity is why most of these services are initially launching in jurisdictions outside the U.S.
The innovation also disrupts existing structures. Bryan Routledge, an Associate Professor of Finance at Carnegie Mellon University's Tepper School of Business, pointed out, "You are changing how trading is done, not just the format of the asset." He predicts this will create competition with the entire ecosystem of exchanges and brokers.
Perhaps the most telling statistic is the current market size. According to data from RWA.xyz, **the total market capitalization for all tokenized stocks is currently just $388 million.** This figure is微不足道 (minuscule) when compared to the global equity market, which is valued at over $120 trillion. Bridging this gap will require not just technological innovation, but widespread regulatory acceptance and a major shift in investor behavior.
Frequently Asked Questions
What are tokenized stocks?
Tokenized stocks are digital representations of traditional company shares issued on a blockchain. Each token is backed 1:1 by a real share held in custody by a regulated entity, granting the holder the same economic benefits, like dividends and price exposure.
How can I trade tokenized stocks?
You can trade them on supported cryptocurrency exchanges like Bybit and Kraken, or through brokerages like Robinhood (in specific regions). Trading occurs 24/7, unlike traditional stock market hours.
Are tokenized stocks available to U.S. investors?
Currently, most services from major crypto exchanges are not available to U.S. residents due to regulatory considerations. Robinhood's service is initially for EU users. This is a rapidly evolving area, so availability may change.
What are the main benefits of tokenized stocks?
Key benefits include the ability to trade 24/7, easier access for international investors, potential for integration with DeFi applications, and the use of a single wallet for both crypto and traditional assets.
What is the role of stablecoins in this market?
Stablecoins are crucial as they act as the primary trading pair and settlement medium for tokenized stocks on blockchain platforms, providing a stable value equivalent to the U.S. dollar for executing trades.
What are the biggest risks?
The main risks involve regulatory uncertainty, potential technical smart contract risks, and the dependency on the issuer properly custoding the underlying shares to back the tokens.