With $23.3 billion in real-world assets (RWA) now on-chain, crypto-native platforms are increasingly bridging traditional finance.
Exchanges like Kraken and Binance have launched tokenized versions of popular U.S. stocks, including Apple and Tesla.
Analysts are split: Some see massive potential for tokenized stocks in crypto, while others argue only high-volatility "meme stocks" will gain traction.
Crypto exchange Kraken recently unveiled xStocks, offering tokenized versions of equities like Apple, Nvidia, and Tesla on Solana. This move merges crypto with traditional finance in the expanding RWA sector.
But can tokenized stocks succeed where past attempts failed? And will they appeal to crypto’s notorious "degen" traders, who thrive on high-risk, high-volatility bets?
Ryan Lee, chief analyst at Bitget, told Cryptonews:
"Tokenized stocks hold immense potential in crypto by enabling fractional ownership, 24/7 trading, and enhanced liquidity via blockchain."
These digital securities mirror traditional stocks on-chain. Kraken’s 50+ xStocks tokens (issued on Solana) are 1:1 backed by physical shares held by Swiss-regulated Backed Finance. For example, AAPLx tracks Nasdaq’s Apple stock price and is redeemable for cash.
Investors bypass direct stock ownership—holding tokens instead. Notably, Kraken’s offering excludes U.S. customers, targeting only select international markets.
Kraken isn’t the first:
Bybit recently launched similar products.
Binance attempted tokenized stocks in 2021 but shelved the project under Hong Kong regulatory pressure.
While adoption remains limited, proponents argue tokenized stocks could revolutionize market participation.
Sam MacPherson, CEO of Phoenix Labs (developer of Spark Protocol), said:
"They transform static markets into composable DeFi lego blocks—enabling global access, real-time settlement, and novel applications like collateralized lending."
But skepticism persists. Georgii Verbitskii, founder of DeFi platform Tymio, cautioned:
"Success hinges on listing volatile, narrative-driven assets—think GameStop, not Microsoft. Crypto traders crave high-beta plays."
Crypto investors have long favored speculative assets, mirroring the 2021 GameStop frenzy (where shares surged 1,600% amid Reddit-driven short squeezes). That mania spilled into crypto, birthing meme tokens like GME and AMC.
Verbitskii added:
"Tokenized commodities (e.g., gold) may gain traction faster—they offer hedging utility and have precedents like FTX’s gold futures."
Compliance remains critical. Binance’s 2021 failure stemmed from lacking securities licenses. Kraken’s partnership with Backed Finance (regulated under EU’s MiFID II) aims to preempt such issues.
Adam Levi, Backed’s co-founder, told Cryptonews:
"xStocks are fully collateralized, compliant with EU/Jersey/Swiss laws, and designed for institutional-grade adoption."
He predicts the tokenized stock market could hit $250 billion, following stablecoins’ growth trajectory.
Dubai’s Allo Securities has tokenized $2.2 billion in assets, including Tesla and SpaceX pre-IPO shares. CEO Kingsley Advani noted:
"Tokenization lowers barriers, accelerates settlement (from days to minutes), and reduces counterparty risk."
Allo’s compliance team navigates U.S./EU regulations, though Advani didn’t detail specific challenges.
With $23.3 billion in on-chain RWAs (up 6% monthly), tokenized stocks are gaining momentum. But their crypto appeal may depend on two factors:
Volatility: Meme-like action could attract degens.
Regulation: Platforms must walk the compliance tightrope.
As Levi put it:
"The infrastructure is ready, demand is rising—this shift is inevitable."
