Tokenized trading models gain momentum
Tokenized stocks may significantly change how global markets function by enabling continuous trading, fractional share ownership, and faster settlement, according to statements from Coinbase CEO Brian Armstrong.
Armstrong said that blockchain-based representations of equities could allow markets to operate around the clock, making it possible for investors to buy and sell shares at any time rather than being limited to traditional exchange hours. He added that tokenization may allow fractional ownership, enabling smaller investors to access shares that are typically out of reach due to high prices.
Another proposed benefit is real-time settlement. Traditional equity trades can take days to finalize, while on-chain settlement could reduce this to minutes, potentially lowering counterparty risk and freeing capital more quickly.
Tokenized equity markets could also introduce new financial instruments such as perpetual futures and blockchain-native governance models. These changes could alter how investors interact with public companies, particularly if on-chain governance tools gain broader acceptance.
Legal and regulatory questions remain
The concept has generated both support and skepticism within the digital asset community. Some analysts argue that tokenized stocks can improve access, remove intermediaries, and make global participation easier. Others have raised concerns about legal enforceability, regulatory oversight, and the risks associated with tokens that are not issued directly by the underlying companies.
Commentators have also warned that some tokenized equities function as side bets on company performance rather than as direct claims on corporate ownership. This structure can introduce legal ambiguity, particularly in jurisdictions where on-chain settlement and shareholder rights are not yet clearly defined.
Data from recent market activity shows that transfers involving tokenized equities reached approximately 2.46 billion dollars last month, indicating growing interest despite unresolved regulatory questions.
Armstrong has outlined a longer-term strategy in which Coinbase aims to build an integrated platform that would allow trading of cryptocurrencies, tokenized equities, and commodities in a single environment by 2026. Whether this model becomes widely adopted will likely depend on how regulators, issuers, and investors address governance, settlement, and compliance challenges.
