Crypto Platforms Expand Tokenized U.S. Stocks Globally — Growth & Risks

The recent expansion in tokenized U.S. equity offerings from crypto platforms reflects a strategic pivot for exchanges staring at a depressed crypto market but seeing sustained investor demand for large-cap tech and equity exposure. Among the most active are Kraken, which via its “xStocks” product (Backed Finance partnership) offers over 50 U.S. stocks and ETFs to non-U.S. users, trading 24/7 on chains like Solana. Bitget and decentralized venue Jupiter have also entered the market amid rising overseas demand.

Binance is exploring a reintroduction of stock tokens, having earlier ceased the offering in 2021 following regulatory pushback from Germany’s BaFin regarding prospectus requirements. OKX, meanwhile, is considering tokenized equities as part of its global product expansion. All these moves prioritize international users rather than the U.S. domestic market.

From a regulatory angle, the discrepancy in frameworks globally stands out. In Europe, entities like Kraken use licensed MiFID II intermediaries (e.g. Cyprus) to launch compliant token-stock products. By contrast, in the U.S., legal regimes—SEC, CFTC, securities law, Exchange Act—do not yet provide clarity for tokenized stock offerings. Coinbase is currently seeking SEC approval for tokenized equities for U.S. users, illustrating both the demand and the regulatory uncertainty.

Financial metrics illustrate both potential and scale challenges. The stock token market reached about USD 915 million in total value in circulation—only ~0.0015% of the S&P 500’s ~USD 60 trillion market cap. Trading volume is modest; e.g. Tesla stock tokens saw ~USD 12 million in one day whereas regular Tesla shares saw ~USD 29 billion.

Strategic implications for all parties involved:

• Crypto exchanges seeking new revenue should gain first-mover advantages but expose themselves to compliance, counterparty, and settlement risk.
• Traditional brokers and exchanges (e.g. NYSE, Nasdaq) resent margin pressure and could leverage their regulation and infrastructure to compete via tokenization.
• U.S. regulators will increasingly determine whether these offerings can proliferate domestically or be restricted or regulated. Legislation or rulemaking may impact how tokenized equities are defined and treated.
• Issuers of U.S. equities may need to decide whether to grant share-level rights (voting, dividends) to token holders, which could affect ownership control and financial disclosures. There is potential for platforms like Securitize or Superstate that work directly with issuers to offer legal compliance to demand markets.

Open questions:

• Will U.S. legislative efforts or SEC rulemaking force crypto exchanges to register or restrict token stock offerings?
• How will investor protections like ownership rights, voting, dividend entitlement, and disclosure be enforced for token holders?
• Which structures—SPVs owning underlying shares vs. derivatives—will dominate, and how will each’s risks be evaluated?
• Will regulatory clarity prompt tokenized stock product rollout inside U.S. markets, or will offshore markets and international users remain core client base?