In the late 1980s, Nathan Most worked at the American Stock Exchange. He wasn’t a banker or trader but a physicist with a background in logistics, shipping metals and commodities. Financial instruments weren’t his starting point; practical systems were.

At the time, mutual funds were a popular way to gain broad market exposure. They offered diversification but came with delays—orders executed only at market close, a process that remains unchanged today. For traders accustomed to real-time stock trading, this felt archaic.

Nathan proposed a workaround: a product tracking the S&P 500 that traded like a single stock. The idea was met with skepticism. Mutual funds weren’t designed for intraday trading, and the legal framework didn’t exist. Yet he persisted.

In 1993, the SPDR S&P 500 ETF (ticker: SPY) launched. Initially niche, it grew into one of the world’s most traded securities, often outpacing the liquidity of its underlying assets. A synthetic structure had surpassed its roots.

Today, this history feels relevant again—not because of another fund, but due to blockchain’s evolution.

Platforms like Robinhood, Backed Finance, Dinari, and Republic now offer tokenized stocks—blockchain-based assets mirroring the prices of Tesla, NVIDIA, or even private firms like OpenAI.

These tokens promise exposure, not ownership. No voting rights, no equity stakes. You hold a token linked to a stock’s performance. This distinction has already sparked controversy, with OpenAI and Elon Musk voicing concerns about Robinhood’s offerings.

Robinhood CEO Vlad Tenev later clarified that these tokens provide retail investors access to otherwise inaccessible private assets. Unlike traditional stocks, these tokens are third-party creations. Some claim 1:1 backing via custodial shares; others are fully synthetic. The experience mimics brokerage apps, though the legal underpinnings are often flimsier.

Still, they appeal to a specific demographic: investors outside the U.S. who face barriers like foreign brokerage accounts, high minimum balances, and slow settlements. Tokenized stocks eliminate friction—no wire transfers, no paperwork. Just a wallet and a market.

Yet hurdles remain. Many platforms (Robinhood, Kraken, Dinari) aren’t operational in emerging economies. For tokenized stocks to democratize access, solutions must address regulatory, geographic, and infrastructural gaps.

Futures and options have long enabled trading without direct asset ownership. Tokenized stocks follow a similar ethos—they’re not “better” than stocks but offer alternative pathways, especially for marginalized investors.

New derivatives typically evolve through stages:

1. Chaos: Unclear pricing, hesitant traders, watchful regulators.

2. Speculation: Arbitrageurs exploit inefficiencies.

3. Adoption: Mainstream players enter as infrastructure matures.

This pattern held for index futures, ETFs, and Bitcoin derivatives. Tokenized stocks may replicate it—starting as a playground for retail traders chasing exposure to pre-IPO firms, then attracting arbitrageurs and, eventually, institutions in compliant jurisdictions.

Early markets will be noisy: thin liquidity, wide spreads, weekend price gaps. But derivatives often begin as imperfect proxies, stress-testing demand before the asset class adjusts.

Traditional markets have opening and closing bells. Most stock-based derivatives follow these hours, but tokenized stocks don’t. If NVIDIA closes at $130 on Friday and news breaks Saturday, tokens may react while equities stay frozen.

This lets traders price in off-market events—until token volumes dwarf the underlying stocks. Futures manage such gaps with funding rates; ETFs rely on arbitrage. Tokenized stocks lack these mechanisms, leaving prices volatile and trust-dependent.

Trust levels vary. When Robinhood launched OpenAI and SpaceX tokens in the EU, both firms denied involvement. The question arises: Are you buying price exposure or a synthetic derivative with unclear rights?

Infrastructure differs wildly. Some tokenizers operate under European frameworks; others use smart contracts and offshore custodians. A few, like Dinari, test regulated approaches. Most push legal boundaries.

The SEC hasn’t clarified its stance on tokenized traditional stocks. Hence, Robinhood launched its product in the EU, not the U.S. Demand, however, is undeniable. Republic offers synthetic access to SpaceX; Backed Finance wraps stocks on Solana. These experiments persist, targeting frictionless participation—not ownership economics.

For retail investors, access often trumps form. If tapping NVIDIA via a stablecoin-friendly app takes three clicks, few care if the product is synthetic.

Tokenized stocks don’t compete with stocks but with the effort to acquire them. Like SPY, CFDs, or futures, they may start as tools for traders but could democratize access.

The infrastructure is embryonic. Liquidity is patchy. Regulations are opaque. Yet the premise is clear: Build a system that mirrors assets, eases access, and is “good enough” for adoption. If it holds, volume will follow. What’s now a shadow may become the signal.

Nathan Most didn’t aim to redefine markets—he sought a smoother interface. Today’s tokenizers share that goal, but their wrapper is a smart contract, not a fund. The question is whether these new vessels can weather storms.

They’re not stocks. They’re not regulated products. They’re tools of proximity. For many—especially those excluded from traditional finance—that proximity may suffice.

Will it hold when markets turn?

In the late 1980s, Nathan Most worked at the American Stock Exchange. He wasn’t a banker or trader but a physicist with a background in logistics, shipping metals and commodities. Financial instruments weren’t his starting point; practical systems were.

At the time, mutual funds were a popular way to gain broad market exposure. They offered diversification but came with delays—orders executed only at market close, a process that remains unchanged today. For traders accustomed to real-time stock trading, this felt archaic.

Nathan proposed a workaround: a product tracking the S&P 500 that traded like a single stock. The idea was met with skepticism. Mutual funds weren’t designed for intraday trading, and the legal framework didn’t exist. Yet he persisted.

In 1993, the SPDR S&P 500 ETF (ticker: SPY) launched. Initially niche, it grew into one of the world’s most traded securities, often outpacing the liquidity of its underlying assets. A synthetic structure had surpassed its roots.

Today, this history feels relevant again—not because of another fund, but due to blockchain’s evolution.

Platforms like Robinhood, Backed Finance, Dinari, and Republic now offer tokenized stocks—blockchain-based assets mirroring the prices of Tesla, NVIDIA, or even private firms like OpenAI.

These tokens promise exposure, not ownership. No voting rights, no equity stakes. You hold a token linked to a stock’s performance. This distinction has already sparked controversy, with OpenAI and Elon Musk voicing concerns about Robinhood’s offerings.

Robinhood CEO Vlad Tenev later clarified that these tokens provide retail investors access to otherwise inaccessible private assets. Unlike traditional stocks, these tokens are third-party creations. Some claim 1:1 backing via custodial shares; others are fully synthetic. The experience mimics brokerage apps, though the legal underpinnings are often flimsier.

Still, they appeal to a specific demographic: investors outside the U.S. who face barriers like foreign brokerage accounts, high minimum balances, and slow settlements. Tokenized stocks eliminate friction—no wire transfers, no paperwork. Just a wallet and a market.

Yet hurdles remain. Many platforms (Robinhood, Kraken, Dinari) aren’t operational in emerging economies. For tokenized stocks to democratize access, solutions must address regulatory, geographic, and infrastructural gaps.

Futures and options have long enabled trading without direct asset ownership. Tokenized stocks follow a similar ethos—they’re not “better” than stocks but offer alternative pathways, especially for marginalized investors.

New derivatives typically evolve through stages:

1. Chaos: Unclear pricing, hesitant traders, watchful regulators.

2. Speculation: Arbitrageurs exploit inefficiencies.

3. Adoption: Mainstream players enter as infrastructure matures.

This pattern held for index futures, ETFs, and Bitcoin derivatives. Tokenized stocks may replicate it—starting as a playground for retail traders chasing exposure to pre-IPO firms, then attracting arbitrageurs and, eventually, institutions in compliant jurisdictions.

Early markets will be noisy: thin liquidity, wide spreads, weekend price gaps. But derivatives often begin as imperfect proxies, stress-testing demand before the asset class adjusts.

Traditional markets have opening and closing bells. Most stock-based derivatives follow these hours, but tokenized stocks don’t. If NVIDIA closes at $130 on Friday and news breaks Saturday, tokens may react while equities stay frozen.

This lets traders price in off-market events—until token volumes dwarf the underlying stocks. Futures manage such gaps with funding rates; ETFs rely on arbitrage. Tokenized stocks lack these mechanisms, leaving prices volatile and trust-dependent.

Trust levels vary. When Robinhood launched OpenAI and SpaceX tokens in the EU, both firms denied involvement. The question arises: Are you buying price exposure or a synthetic derivative with unclear rights?

Infrastructure differs wildly. Some tokenizers operate under European frameworks; others use smart contracts and offshore custodians. A few, like Dinari, test regulated approaches. Most push legal boundaries.

The SEC hasn’t clarified its stance on tokenized traditional stocks. Hence, Robinhood launched its product in the EU, not the U.S. Demand, however, is undeniable. Republic offers synthetic access to SpaceX; Backed Finance wraps stocks on Solana. These experiments persist, targeting frictionless participation—not ownership economics.

For retail investors, access often trumps form. If tapping NVIDIA via a stablecoin-friendly app takes three clicks, few care if the product is synthetic.

Tokenized stocks don’t compete with stocks but with the effort to acquire them. Like SPY, CFDs, or futures, they may start as tools for traders but could democratize access.

The infrastructure is embryonic. Liquidity is patchy. Regulations are opaque. Yet the premise is clear: Build a system that mirrors assets, eases access, and is “good enough” for adoption. If it holds, volume will follow. What’s now a shadow may become the signal.

Nathan Most didn’t aim to redefine markets—he sought a smoother interface. Today’s tokenizers share that goal, but their wrapper is a smart contract, not a fund. The question is whether these new vessels can weather storms.

They’re not stocks. They’re not regulated products. They’re tools of proximity. For many—especially those excluded from traditional finance—that proximity may suffice.

Will it hold when markets turn?