Author: Lawrence Lee, Researcher at Mint Ventures.
Recently, there have been many developments in the field of tokenized U.S. stocks:
Centralized exchange Kraken announces the launch of a tokenized stock trading platform xStocks.
Centralized exchange Coinbase announces seeking regulatory approval for its tokenized stock trading.
Public chain Solana submits a framework for blockchain-based tokenized U.S. stock products.
Public chains and exchanges with a U.S. background are accelerating the tokenization of U.S. stocks, compounded by the recent enthusiasm following Circle's listing, which inevitably makes one optimistic about the prospects of tokenized U.S. stocks.
In fact, the value proposition of tokenized U.S. stocks is very clear:
1. Expanded the trading market scale: provides a 7×24 hour, borderless, permissionless trading venue for U.S. stock trading, which is currently not possible for NASDAQ or NYSE (although NASDAQ is applying for 24-hour trading, it is expected to achieve this by the second half of 2026).
2. Superior composability: By integrating with existing DeFi infrastructure, U.S. stock assets can be used as collateral, margin, or to build index and fund products, generating many currently unimaginable use cases.
The demands of both supply and demand sides are also very clear:
Supply side (U.S. listed companies): through a borderless blockchain platform, they reach potential investors from around the world and gain more potential buyers.
Demand side (investors): many investors who previously could not directly trade U.S. stocks for various reasons can now directly allocate and speculate on U.S. stock assets through blockchain.
Cited from (U.S. stocks on-chain and STO: an unspoken narrative)
In this round of lenient crypto regulatory cycle, progress is highly likely. According to data from RWA.xyz, the current market cap of tokenized stocks is only $321 million, with 2,444 addresses holding tokenized stocks.
There is a stark contrast between the huge market potential and the currently limited asset scale.
In this article, we will analyze the current players in the tokenized U.S. stock market and the product solutions of other players promoting tokenized U.S. stocks, and list potential investment targets under this concept.
This article reflects the author's thoughts as of publication, which may change in the future and the views are highly subjective, and there may be errors in facts, data, and logical reasoning. All opinions expressed in this article are not investment advice, and criticism and further discussion from peers and readers are welcome.
According to data from rwa.xyz, the current tokenized stock market has the following projects based on issuance scale:
We will introduce the business models of Exodus, Backed Finance, and Dinari one by one (Montis Group focuses on European stocks, SwarmX's business is similar to Backed Finance but on a smaller scale), as well as the progress of several other important players currently involved in tokenized U.S. stock business.
Exodus
Exodus (NYSE.EXOD) is a U.S. company primarily engaged in the development of non-custodial crypto wallets, and its stock is listed on the New York Stock Exchange (NYSE.EXOD). In addition to its own branded wallet, Exodus has previously collaborated with the NFT market MagicEden to launch a wallet together.
As early as 2021, Exodus allowed users to migrate their common stocks to the Algorand chain through Securitize, but the tokens migrated to the chain cannot be traded or transferred on-chain, nor do they include governance rights or other economic rights (such as dividends). Exodus tokens are more similar to a 'digital avatar' of real shares, with symbolic meaning on-chain rather than actual significance.
Currently, EXOD has a market capitalization of $770 million, with about $240 million on-chain.
Exodus is the first stock approved by the SEC for tokenization (or more accurately, Exodus is the first stock approved by the SEC to launch on the NYSE), although this process has not been smooth. The listing date for Exodus stock has been delayed multiple times since May 2024, and it only officially launched on the NYSE in December.
However, Exodus's stock tokenization is only for its own stocks, and the tokenized stocks cannot be traded, which is of little significance for us web3 investors.
Dinari
Dinari is a U.S.-registered company established in 2021, focusing on tokenizing stocks within the U.S. compliance framework. In 2023, it completed a $10 million seed round financing and a $12.7 million Series A round in 2024, with investors including Hack VC and Blockchange Ventures, Coinbase CTO Balaji Srinivasan, F Prime Capital, VanEck Ventures, and Blizzard (Avalanche Fund). Among them, F Prime is a fund under asset management giant Fidelity, and investments by Fidelity and VanEck demonstrate traditional asset management institutions' recognition of the tokenized U.S. stock market.
Dinari only supports non-U.S. users, and its process for trading U.S. stocks is as follows:
Users complete KYC.
Users select the U.S. stocks they want to purchase and pay with Dinari-issued USD+ (a stablecoin supported by Dinari-issued short-term government bonds, which can be exchanged for USDC).
Dinari submits orders to cooperating brokers (Alpaca Securities or Interactive Brokers), and once the brokers complete the orders, the shares are held in a custodian bank, and Dinari mints the corresponding dShares for users.
Currently, Dinari operates on Arbitrum, Base, and the Ethereum mainnet, with all dShares corresponding to real-world equity on a 1:1 basis. Users can view the equity corresponding to their dShares through the Dinari official website, and Dinari can also distribute dividends or perform stock splits for users holding its dShares.
However, dShares cannot be traded on-chain; to sell dShares, one must still trade through the Dinari official website, and the actual trading process is the reverse of the purchasing process. The trading of dShares must also comply with U.S. trading hours, and buying and selling cannot occur outside of trading hours. In terms of product form, in addition to direct stock trading, they also provide stock trading APIs that can cooperate with other trading frontends.
In fact, Dinari's business process, i.e., 'KYC -> payment exchange -> compliance broker clearing,' is consistent with the mainstream method for non-U.S. users to participate in U.S. stock trading. The main difference is that the asset categories users pay with are Hong Kong dollars, euros, etc., while Dinari accepts crypto assets; everything else is executed entirely under the SEC's regulatory framework.
As a company primarily engaged in tokenizing U.S. stocks, Dinari's decision to register in the U.S. (most other projects are registered in Europe) shows its confidence in its compliance capabilities. Their tokenized U.S. stock products were officially launched in 2023, and at that time, the former SEC chairman Gary Gensler, known for his stringent approach to crypto regulation, couldn't find fault with their business model. After the new SEC chairman Paul Atkins took office, the SEC specifically met with Dinari, requesting them to demonstrate their system and answer related questions (source), indicating the impeccable compliance of their product and the strong resources of their compliance team.
However, since Dinari's tokenized U.S. stocks do not support on-chain trading, cryptocurrencies for Dinari only serve as an entry and payment method. The functionality of Dinari's products does not differ significantly from those of Futu, Robinhood, etc. For its target users, the trading experience on Dinari does not offer any improvement over trading U.S. stocks on Futu, nor can it utilize margin trading and other functions, and may even incur higher fees.
Perhaps due to this, Dinari's tokenized stock market scale has always been small, with only MSTR exceeding $1 million in market cap among tokenized stocks, and only five tokenized stocks exceeding $100,000. Currently, most of its TVL comes from its floating interest rate government bond products.
Dinari's current tokenized stock market cap source.
Overall, Dinari's tokenized stock business model has received regulatory certification, but strict adherence to regulations has led to its tokenized stocks being unable to trade/stake on-chain, losing composability, making the experience of holding its dShares less appealing than traditional brokers, and the product is not very attractive to mainstream web3 users.
Among the current market players, the community project mystonks.org, similar to Dinari, has disclosed its reserve report, showing a market cap of over $50 million in U.S. stock accounts, with user trading being more active than Dinari.
However, mystonks.org's compliance structure still has flaws, such as the qualifications of its securities custody accounts being unclear and reserve reports not being verifiable by users.
Backed Finance
Backed Finance is a Swiss company established in 2021, and its product was launched in early 2023. In 2024, it completed a $9.5 million financing led by Gnosis, with participants including Cyber Fund, Blockchain Founders Fund, Blue Bay Capital, etc.
Like Dinari, Backed does not provide services to U.S. users. Its business process is as follows:
Issuers (professional investors) complete KYC certification and approval with Backed Finance.
Issuers choose the U.S. stocks they want to purchase and pay with stablecoins.
Backed Finance submits orders to cooperating brokers to complete stock purchases, and then Backed Finance mints the corresponding bSTOCK token for the issuer.
Both bSTOCK and its wrapped version wbSTOCK can be freely traded on-chain (the wrapping is mainly for the convenience of handling stock dividends, etc.), and ordinary C-end investors can directly purchase bSTOCK or wbSTOCK on-chain.
It can be seen that, unlike Dinari's C-end users directly purchasing U.S. stocks, Backed Finance currently has professional investors purchase U.S. stocks and then transfer them to C-end users, significantly improving overall operational efficiency and allowing for 24*7 trading time. Another important distinction is that the bSTOCK token issued by Backed is an unrestricted ERC-20 token, allowing users to form LPs on-chain for other users to purchase.
Liquidity source of Backed tokenized stocks.
The on-chain liquidity of Backed Finance mainly comes from the SPX index, Coinbase, and Tesla, with users pairing bSTOCK tokens with stablecoins into AMM pools. Currently, the total TVL of the liquidity pool is close to $8 million, with an average APY of 32.91%. The liquidity is distributed among Gnosis's Balancer and Swapr, Base's Aerodrome, and Avalanche's Pharaoh, with the bCOIN-USDC pool's APY reaching 149%.
It should be noted that Backed Finance does not restrict the on-chain trading functionality of its bSTOCK tokens at all, giving users a second path to hold their bSTOCK, i.e.:
On-chain users (no KYC required) directly use stablecoins like USDC or sDAI to purchase bSTOCK.
This effectively breaks through the KYC limitations, and the trading experience is indistinguishable from trading ordinary on-chain tokens, making it easier to promote among web3 users. An unrestricted ERC-20 token also opens the door for tokenized stock holders to composability, such as pairing with stablecoins to achieve an average liquidity APY of 33%. This may also explain why Backed Finance's TVL is close to ten times that of Dinari.
In terms of compliance, the entity behind Backed Finance is registered in Switzerland, and the above business model of 'tokenized stocks corresponding to ERC-20 tokens can be freely transferred' has been recognized by European regulators (source). Backed Finance has also published reserve proof audited by The Network Firm.
However, the U.S. SEC has not yet commented on Backed Finance's business. The securities traded by Backed are all U.S. stocks, and while obtaining a license from Switzerland is good, more importantly, how the U.S. regulatory authority evaluates this business model.
Among other projects, SwarmX's business model is consistent with Backed Finance, but its business scale and compliance details differ significantly from Backed Finance.
Although Backed Finance's tokenized stock market cap is ten times that of Dinari, the asset scale of over $20 million and $8 million TVL is still not high, and on-chain trading is not active due to:
There are currently not enough use cases for tokenized stocks on-chain, and they can only serve as LPs; the advantages of composability have not been fully realized, which may be related to concerns about the legality of associated lending, stablecoin, and other protocols.
More importantly, there is a lack of liquidity. Backed itself is not an exchange and does not have 'natural' liquidity to support its tokenized stock trading. Under the current model, the liquidity of its tokenized stocks relies on the issuer, including how many tokenized stocks the issuer is willing to hold and how much liquidity they are willing to add to LP. Currently, the issuers of Backed do not seem willing to increase their investment in this area.
If the SEC can further clarify the regulatory framework and determine the feasibility of the Backed model, both points may improve.
xStocks
In May of this year, U.S. exchange Kraken announced it would collaborate with Backed Finance and Solana to launch xStocks.
On June 30, the xStocks product was officially launched, with partners including Backed, Kraken, and Solana, as well as centralized exchanges Kraken and Bybit, decentralized exchanges Raydium and Jupiter on Solana, the lending protocol Kamino, the Dex Byreal incubated by Bybit, the oracle Chainlink, the payment protocol Alchemy Pay, and the broker Alpaca.
Source: xStocks official website
The legal structure of xStocks products is identical to that of Backed Finance, currently supporting over 200 stock products. Kraken's trading hours are 5*24. In terms of partnerships, Kraken, Bybit, Jupiter, Raydium, and Byreal are all exchanges supporting xStocks; Kamino can use xStocks as collateral, while Kamino Swap can also trade xStocks; Solana is the public chain on which xStocks operates; Chainlink is responsible for reserve reporting; Alpaca is the partner broker.
Currently, due to the recent launch of the product, various data statistics are incomplete, and the trading volume is not large. However, xStocks has more key partners compared to Backed Finance's own products.
On the Cex side, there are Kraken and Bybit, which are more likely to leverage existing market makers and users to provide better liquidity for xStocks.
And on-chain, there are various DEXs and Kamino, which first provided other use cases for tokenized U.S. stocks besides LP, and there may be other protocols supporting xStocks in the future, further expanding its composability.
From this perspective, although xStocks has just launched, the author believes that xStocks will quickly surpass existing players to become the largest issuer of tokenized U.S. stocks.
Robinhood
Robinhood, which has been actively expanding into the crypto business, also submitted a report to the SEC in April 2025, hoping the SEC would establish an RWA regulatory framework that includes tokenized stocks; in May, Bloomberg reported that Robinhood would create a blockchain platform to allow European investors to invest in U.S. stocks, with Arbitrum or Solana as alternative public chains.
On June 30, Robinhood officially announced the launch of a tokenized U.S. stock trading product for European investors, which supports dividend distribution and 5*24 access time.
Robinhood's tokenized stock products were initially issued on Arbitrum. In the future, the underlying tokenized stocks will operate on Robinhood's own L2, which is also based on Arbitrum.
However, according to Robinhood's official documentation, its current tokenized stock products are not true tokenized stocks; they are contracts tracking the corresponding U.S. stock prices, and the related assets are safely held by a licensed institution in the Robinhood Europe account. Robinhood Europe issues contracts and records them on the blockchain. Its tokenized stocks can currently only be traded on Robinhood and cannot be transferred.
Other players in the layout.
In addition to the products with specific business launches we mentioned above, many other players are also laying out tokenized U.S. stock businesses, including:
Solana
Solana places great importance on tokenized stocks. In addition to the aforementioned xStocks, Solana has also established the Solana Policy Institute (SPI), 'aiming to educate policymakers on why decentralized networks like Solana are the future infrastructure of the digital economy.' Currently, two projects are underway: one is a project named Project Open, 'aiming to achieve compliant blockchain-based securities issuance and trading, creating more efficient, transparent, and accessible capital markets while maintaining strong investor protection.' Members of Project Open include SPI, Dex Orca on the Solana chain, RWA service provider Superstate, and law firm Lowenstein Sandler LLP.
Project Open has submitted public written opinions to the SEC's crypto working group multiple times since April this year. The SEC's crypto working group also met with them on June 12 to discuss, and members of Project Open submitted further explanations of their business after the meeting.
The tokenized U.S. stock issuance and trading process advocated by Project Open is as follows:
Source: SEC official documents
The process can be summarized as follows:
Issuers need to apply in advance for SEC approval; once approved, they can issue tokenized U.S. stocks.
Users wishing to purchase tokenized U.S. stocks need to complete KYC in advance, after which they can use cryptocurrency to buy tokenized U.S. stocks issued by the above issuer.
Transfer agents registered with the SEC record the flow of shares on-chain.
Project Open also specifically requests that the SEC allow peer-to-peer tokenized U.S. stock trading conducted through smart contract protocols, enabling holders of tokenized U.S. stocks to trade within AMMs, thus opening the door to on-chain composability. However, according to the framework proposed in the document, all users holding tokenized U.S. stock shares must complete KYC. To achieve the above process, Project Open is applying for an 18-month exemption or confirmatory guidance for numerous operations (Exemptive Relief or Confirmatory Guidance, see reference materials for details).
Overall, the Project Open solution supplements KYC requirements based on the existing Backed Finance plan. From the author's perspective, this solution is almost guaranteed to pass under the current SEC's relatively lenient stance towards DeFi; the only question is the timing of approval.
Coinbase
As early as 2020, when Coinbase applied for a Nasdaq listing, its application documents included the idea of issuing tokenized COIN on-chain, but the application was abandoned due to not meeting the SEC's requirements at the time. Recently, Coinbase is seeking a no-action letter or exemptive relief from the SEC for its tokenized stock business. However, there are currently no detailed documents available; we can only gather a confirmed piece of information from press releases:
Coinbase's tokenized stock trading plan is open to U.S. users.
This is the main difference from other current players in the tokenized stock market, allowing Coinbase to compete directly with internet brokers like Robinhood and traditional brokers like Charles Schwab. Of course, this impact is far less for web3 investors than for Nasdaq:COIN.
Ondo
Ondo, which has achieved results in the RWA market for government bonds, has also planned to enter the tokenized U.S. stock business. According to their documents, their tokenized U.S. stock products have the following characteristics:
Open to non-U.S. users.
Trading hours are 24*7.
Real-time minting and burning of tokens.
Allows tokenized U.S. stock assets to be used as collateral.
From the characteristics described above, Ondo's products are quite similar to the new framework proposed by Solana. Ondo also proposed to launch tokenized U.S. stock products on the Solana network at the Solana Accelerate conference.
Ondo's tokenized U.S. stock product, Ondo Global Markets, is planned to launch later this year.
This is the current state of the tokenized U.S. stock market, as well as the situation of several other players who are currently positioning themselves.
From the fundamental motivation of demand, the main purpose for users to purchase tokenized stocks is to profit from price fluctuations, focusing on the liquidity of the trading venue, redemption capability, and whether KYC-free trading is possible; whether a compliant entity is necessary for tokenization is not a concern for users. Therefore, there has always been a way in the web3 market to provide U.S. stock trading products through derivatives.
Providing U.S. stock trading through derivatives.
The main providers of U.S. stock derivatives services are Gains Network (on Arbitrum and Polygon) and Helix (on Injective). Their users do not actually trade U.S. stocks, so there is no need to tokenize U.S. stocks.
Its core product logic is equivalent to applying perpetual contract logic to U.S. stocks, usually as follows:
Trading users do not require KYC, using stablecoins as collateral and allowing leveraged trading.
Trading hours are the same as U.S. stock trading hours.
Target prices are directly read from trusted data sources, such as using Chainlink.
Using funding rates to balance the price discrepancies between on-site prices and fair prices.
However, whether it's today's Gains and Helix or previously Synthetix and Mirror, platforms trading U.S. stocks in the form of synthetic assets haven't generated much actual trading volume. Currently, Helix's U.S. stock products average daily trading volumes of no more than $10 million, while Gains' daily trading volume is less than $2 million, possibly due to:
This form carries significant regulatory risks, as although they do not actually provide trading of U.S. stocks, they effectively become the exchange for users to trade U.S. stocks, and regulators have clear requirements for any exchange, with KYC being the most basic component of regulation. Such platforms may escape regulatory scrutiny when their volume is low, but if their volume increases, they will easily attract regulatory attention.
The above products do not have sufficient liquidity to support the actual trading needs of users. The liquidity of these product forms must be solved internally and cannot rely on any third party, and none of the above products can provide users with true trading depth.
The trading volume of Helix's U.S. stock & forex products and the order book of the highest volume COIN.
On the centralized exchange side, Bybit recently launched a U.S. stock trading platform based on MT5. Its product also adopts a logic similar to perpetual contracts, not conducting actual trading of U.S. stocks, but trading indices with stablecoins as collateral.
In addition, the yet-to-launch Shift project introduced the concept of Asset-Referenced Tokens (ART), which allegedly allows for KYC-free U.S. stock trading. Its product process is as follows:
Shift purchases U.S. stocks and collateralizes them with compliant brokers like Interactive Brokers, using Chainlink for reserve proof.
Shift uses reserve U.S. stock issuance reference asset token ART, each ART corresponds to a U.S. stock asset, but ART is not a tokenized U.S. stock.
C-end users can purchase ART tokens without KYC.
Shift's solution maintains 100% correspondence between ART and underlying U.S. stocks, but ART is not a tokenized U.S. stock and does not confer ownership, dividend rights, or voting rights over the stocks, thus not subject to various regulatory rules for securities, enabling the KYC-free feature (source).
Of course, from a regulatory logic standpoint, it is not permissible for ART to anchor securities-type assets. It is currently unclear how the Shift team plans to specifically implement 'anchoring ART to U.S. stocks,' and whether the specific product plan to be launched can truly proceed as described above. However, this plan achieves KYC-free U.S. stock trading through certain loopholes in regulatory clauses, warranting continued attention.
What kind of tokenized U.S. stock products does the market need?
Regardless of the method of tokenization for U.S. stocks, the core processes are as follows:
Tokenization: The process is usually handled by compliant institutions, which regularly provide reserve proofs, essentially allowing KYC-compliant users to purchase U.S. stocks before they go on-chain. This step does not differ much among various solutions.
Trading: C-end users trade the tokenized stocks. The main differences among various solutions lie here: some do not allow trading (Exodus), some only allow trading through traditional broker channels (Dinari and mystonks.org), and some support on-chain trading (Backed Finance, Solana, Ondo, Kraken). More uniquely, Backed Finance currently supports KYC-free users to directly purchase its tokenized U.S. stock products through AMMs under the Swiss compliance framework.
For C-end users, the main focus in the tokenization process is compliance and asset security. Currently, most of the market players can ensure both points well. The main concern lies in the trading process. For example, if Dinari only allows trading through traditional broker channels and does not provide liquidity mining, lending, or other services for tokenized stocks, the significance of stock tokenization is largely diminished. Even if compliance is perfect and processes are well-defined, it is difficult to attract users.
The solutions from xStocks, Backed Finance, and Solana are more meaningful long-term tokenized U.S. stock solutions, as tokenized U.S. stocks trade on-chain rather than through traditional broker channels, thus more effectively utilizing the 24/7 availability and composability advantages brought by DeFi.
However, in the short term, on-chain liquidity will be difficult to compare with traditional channels' liquidity. An exchange with low liquidity is effectively unusable; if the venue providing tokenized U.S. stocks cannot attract more liquidity, the influence of tokenized U.S. stocks will also be hard to expand. This is why the author is optimistic that xStocks can quickly become tokenized U.S. stocks.
From this perspective, if the regulatory framework becomes clearer and tokenized U.S. stock products become truly popular in web3, those exchanges currently having better liquidity and more trader users are likely to capture more market share.
In fact, we can see from the few examples of the last cycle: Synthetix, Mirror, and Gains all launched products including U.S. stock trading in 2020, but the most influential U.S. stock trading product was FTX. FTX's solution is quite similar to the current Backed Finance solution, but FTX's stock trading volumes and AUM far exceed those of the later Backed Finance.
Potential investment targets.
Despite the large market potential for tokenized U.S. stocks, there are currently few investment targets available for investors to choose from.
Among the existing players, neither Dinari nor Backed Finance has issued tokens, and Dinari has explicitly stated it will not issue tokens; only the meme token stonks corresponding to mystonks.org can be considered a potential investment target.
Among the actively expanding players, the token market capitalizations of Coinbase, Solana, and Ondo have already reached a relatively high level, and their main businesses are not tokenized U.S. stocks. The promotion of tokenized U.S. stocks has some impact on their tokens, but the extent of the impact is difficult to predict.
xStocks' partners include Solana's leading Dex Raydium and Jupiter, as well as the lending protocol Kamino. However, this cooperation is unlikely to significantly enhance the capabilities of the above protocols.
Among the members of SPI's Project Open, Phantom and Superstate have not yet issued tokens, only Orca has issued tokens.
In derivative projects, Helix has not issued a token, only GNS as a selectable target.
Due to the differing categories of business among the above projects, the forms of participating in tokenized U.S. stocks also vary, making valuation comparisons impossible. We can only list the basic information of the related tokens as follows:
Reference materials
https://x.com/xrxrisme69677/status/1925366818887409954
https://www.odaily.news/post/5204183
Project Open-related materials:
Framework submitted in April: https://www.sec.gov/files/ctf-written-project-open-wireframe-04282025.pdf
On June 12, the SEC crypto working group met with the Project Open team to discuss: https://www.sec.gov/files/ctf-memo-solana-policy-institute-et-al-061225.pdf
On June 17, SPI updated the proposal framework and submitted supplementary materials regarding the meeting's content along with Phantom, Superstate, and Orca.
SPI's updated proposal framework: https://www.sec.gov/files/project-open-chain-equities-infrastructure-061725.pdf
SPI supplementary materials: https://www.sec.gov/files/project-open-061725.pdf
Phantom: https://www.sec.gov/files/phantom-technologies-061725.pdf
Superstate: https://www.sec.gov/files/ctf-superstate-letter-061725.pdf
Orca: https://www.sec.gov/files/orca-creative-061725.pdf
The Exemptive Relief or Confirmatory Guidance requested by Project Open includes:
Blockchain as a technological tool does not require or mandate any SEC registration.
Blockchain network fees are technical costs and do not fall under securities trading-related expenses.
Peer-to-peer transactions conducted through smart contract protocols are allowed and do not equate to the regulatory concept of trading on exchanges or alternative trading systems (ATS) (as these are bilateral transactions, such as those envisioned in Section 4(a)(1) of the 1933 Act).
Exemption for broker-dealers participating in transactions under Section 4(a)(1) (assuming a limited management role).
Non-custodial/self-custodial wallets (and their issuers) are not broker-dealers.
Allow holding tokenized shares in non-custodial/self-custodial wallets that have passed appropriate whitelisting and KYC.
Broker-dealers can create sub-wallets for clients to hold their tokenized shares, which constitutes appropriate 'possession and control' for the purpose of broker-dealer custody.
Transfer agents can use blockchain to fulfill their duties if they have KYC information for whitelisted wallet owners and modern qualified investor education information. a) Ability to enforce transfer restrictions. b) Ability to enforce restrictive legends (e.g., securities held by affiliates).
Registration Statement can be used to register tokenized shares after obtaining appropriate exemptive relief. a) Proposal - specific content and format requirements. b) Proposal - methods for periodic reporting.
Purchasing shares directly from the issuer in the manner envisioned above does not make the purchaser a underwriter or broker-dealer; such purchases are not made in the capacity of a broker or dealer.
Appropriate exemptions from Reg NMS (e.g., Order Protection Rule, Best Execution, Access Rule, etc.).