Tokenized Stocks: A New Chapter in the on-chain Capital Market

In the era where cryptocurrency and artificial intelligence intersect, financial tokenization is creating a new wave. Currently, several well-known companies are competing for market dominance through tokenized stocks, and this trend may have profound effects on global capital flows, trading efficiency, and market volatility.

Key Participants and Their Strategies

Robinhood's expansion plan

Robinhood plans to support tokenization of over 1,000 U.S. stocks by the end of the year. Its main features include:

• 24-hour around-the-clock trading
• Lower investment thresholds to achieve partial ownership
• Improve global accessibility

This service is currently limited to the EU market, but Robinhood has announced the launch of a Layer 2 blockchain based on Arbitrum. However, it is important to note that these tokenized stocks are actually representative contracts, not actual stocks.

Kraken's strategy

Kraken chooses to partner with Backed to launch xStocks on Solana, offering over 60 tokenized US stocks and ETFs. Features include:

• Issued on the Solana blockchain
• Starting from 1 dollar
• Compatible with DeFi protocols

Although Kraken has its own Layer 2 network, Ink, it has chosen the Solana ecosystem for tokenization of stocks.

Other participants

Bybit has partnered with Backed to launch xStocks products on its spot platform. Gemini has launched its first tokenized stock MicroStrategy and partnered with Dinari to open it up to EU users.

Market Landscape and Future Outlook

Coinbase's potential layout

As a leading company in the cryptocurrency field, Coinbase is communicating with regulators to explore compliance opportunities for tokenization of stocks. Its advantages include:

• A powerful portfolio covering multiple top DeFi protocols
• Advanced technological infrastructure, such as Base chain

The Importance of Compliance

Compared to the Mirror Protocol in 2020, the current tokenization stock model places greater emphasis on compliance, avoiding regulatory risks. This lays the foundation for the long-term development of the industry.

Transformation of On-Chain Capital Markets

By the end of 2025, the market value of tokenized stocks traded on-chain is expected to reach 20-50 billion USD. This new financial infrastructure will deeply integrate traditional finance with blockchain technology, featuring the following characteristics:

• 24/7 Trading
• Low transaction costs
• Efficient and transparent
• Globally Accessible

In the short term, on-chain stocks may exist as a complement to the traditional stock market. They may bring more stable liquidity, but they could also experience sharp fluctuations in special circumstances due to the lack of traditional circuit breaker mechanisms.

As major platforms deepen their layout, the proportion of tokenized stocks in the financial market may significantly increase. This not only brings new investment opportunities but also comes with higher risks. The financial market is entering a multi-layered integration phase, and tokenized stocks have become an indispensable part of the real financial system.

Currently, some projects like Coinx on the Jupiter platform have already launched, although they are still in the early stages. It is worth noting that on-chain trading prices may be higher than actual stock prices, suggesting that the on-chain market has the potential for "pre-pricing."

With the continuous development of tokenized stocks, the transformation of the on-chain capital market has only just begun. This new type of financial instrument will bring more opportunities for global investors while also driving innovation and change in the traditional financial system.