Original author: OneShotBug
The US stock market is an exciting market, always showcasing astonishing unicorns and entrepreneurial myths, such as NVIDIA, which has seen a meteoric rise in market value, prompting many Chinese-speaking investors to eagerly participate. However, obstacles such as high trading fees, cumbersome account opening processes, and foreign exchange controls make it difficult to directly engage in US stock investment.
As one of the practical applications of the RWA concept, stock tokenization offers a new investment avenue. RWA contracts issued by platforms like xStocks and Ondo allow investors to indirectly invest in the US stock market through tokenized assets, avoiding the cumbersome processes and high costs associated with traditional stock markets.
This article will focus on Bitget's recently launched 'RWA Index perpetual contract', which has initially listed popular US stock targets including NVIDIA (NVDA), Tesla (TSLA), and Circle (CRCL), and has made further innovations based on the RWA contract: on one hand, it calculates the prices of multiple issuer products with weighting, and on the other hand, it allows high-leverage trading for flexible investments. Overall, this seems to be a very suitable tokenized US stock investment product for Chinese-speaking individuals.
Next, I will briefly introduce the RWA Index perpetual contract product and analyze its product advantages, risk management mechanisms, and market opportunities.
Why is the crypto community paying attention to stock tokenization?
As the brightest star in the ongoing deep integration of the cryptocurrency market and traditional financial markets, stock tokenization bridges the gap between the crypto market and traditional stock markets.
With the rapid development of blockchain technology, almost all tokenizable assets have begun to gradually enter the blockchain field. From the initial stablecoins to traditional financial assets such as real estate, bonds, and funds, to the currently hot stock tokenization, each innovation strives to eliminate barriers and obstacles in traditional finance through blockchain, breaking limitations of time and geography.
The core of stock tokenization lies in converting traditional stock assets into digital tokens on the blockchain, thereby enabling 24-hour global trading, fractional share purchasing, and more efficient cross-border transactions. This model is particularly attractive to global retail investors, especially those from emerging markets, as it addresses long-standing pain points such as difficulty in account opening, remittance issues, and mismatched trading hours.
Although stock tokenization is not a new concept, platforms like FTX and Binance attempted to launch related products as early as 2020, but their attempts ultimately failed due to regulatory pressure. However, with the resurgence of market demand and improved technological conditions, stock tokenization has become a focal point again in 2024 and has become one of the hot topics for investors. Nowadays, the continuous development of RWA products has increasingly broadened the opportunities for investors to participate in US stock investments through tokenization.
What is the RWA Index perpetual contract?
The RWA Index perpetual contract is an innovative financial product launched by Bitget. According to the official website, the biggest innovation of the RWA Index perpetual contract lies in its mechanism of multi-issuer weighted pricing. The formation of each index integrates token prices from multiple platforms (such as xStocks and Ondo), gathering various stock tokenized assets into a weighted index. Through weighted pricing, Bitget can aggregate token prices from multiple issuers.
This pricing mechanism makes the RWA Index contracts more flexible and stable, providing higher market transparency. Investors can clearly understand the weight of each token in the contract and obtain a comprehensive market pricing through the weighted index in the contract.
Actual trading can be completed on the Bitget official website and app, by simply searching for the names of related products directly in the contract. Currently, the products available are NVDA, TSLA, and CRCL, supporting USDT trading pairs.
Opportunities for Chinese-speaking investors: Zero-threshold participation in the US stock market
For investors, the US stock market is full of opportunities, especially with world-leading companies like Tesla and NVIDIA that are growing rapidly. However, for many Chinese-speaking investors, direct investment in US stocks has always been fraught with obstacles. First, investors need to open an account through traditional brokerage platforms, a process that often involves cumbersome procedures, such as submitting a large number of identity verification materials and complicated tax declarations. In addition, many investors also face high fees, including account management fees, trading commissions, and remittance fees, which can significantly compress investment returns.
In addition to these traditional obstacles, foreign exchange controls also pose a significant challenge for Chinese-speaking investors. Even if investors are willing to pay fees, often due to market access restrictions, they cannot directly access opportunities in the US stock market.
Because of this, directly investing in US stocks is not only a cumbersome process for many Chinese-speaking investors, but also requires overcoming numerous obstacles. The high-threshold investment environment makes it difficult for them to participate.
Bitget's RWA Index perpetual contract provides investors with a zero-threshold investment method, allowing easy participation in trading tokenized US stock assets through the platform. Investors no longer need the support of traditional stock accounts or even the traditional banking system for currency exchange. This once again demonstrates Bitget's expertise in allowing investors to experience various innovations in the crypto field without complicated processes through innovative products.
Risks and opportunities of high-leverage trading
In addition to breaking through traditional investment barriers, the RWA Index perpetual contract also provides investors with a high-leverage trading mechanism. With up to 10 times leverage, investors can achieve higher returns in the trading of tokenized US stock assets with a smaller capital investment.
Of course, in high-leverage trading, small market fluctuations can lead to significant financial losses. Therefore, investors must be particularly cautious when choosing leveraged trading, closely monitor market changes, and adjust strategies in a timely manner to avoid excessive losses due to adverse fluctuations.
To help investors better control risks in high-leverage trading, Bitget has implemented several risk management measures. These measures are designed to minimize potential losses for investors during market volatility and to protect the safety of investors' funds.
· Trading hours: Trading is available 24 hours from Monday to Friday, specifically from 0:00 every Monday to 0:00 every Saturday in Eastern Time (UTC-4). Additionally, RWA contracts will be halted during US public holidays when the stock market is closed.
· Market freeze: Prices are frozen during weekends and when the stock market is closed to avoid liquidation, allowing order cancellations but suspending new order submissions, with fund fee settlements resuming with trading.
· Leverage limit: The initial leverage limit is set at 10 times, supporting isolated margin mode.
· Risk fund: Bitget has equipped each RWA Index perpetual contract with a risk fund to respond to potential risks arising from extreme market fluctuations. The initial amount of the risk fund is 50,000 USDT and is used as compensation funds during severe market volatility. This fund provides an additional layer of protection for investors, alleviating risks associated with high-leverage trading.
· Position limit: Bitget has also set a position limit for individual accounts to prevent any single investor's position from becoming too large, thereby affecting market liquidity and stability. By limiting the maximum position of individual investors, Bitget can better control market risk and avoid market instability caused by excessive trading by any single investor.
These measures provide stronger protections for investors when using high leverage. Regardless of how the market fluctuates, investors can feel a certain degree of safety net, reducing potential risks in trading.
Conclusion
From the actual stocks on-chain driven by Kraken, Bybit, and Robinhood to the compliant token issuance by xStocks, Dinari, and Ondo, and to Tron Inc.'s 'on-chain asset reverse market entry' attempts, this round of asset structure reconstruction is not just about innovations in smart contracts or product forms, but about whether a complete on-chain financial ecosystem can be built.
The RWA Index perpetual contract emerged in this context, opening the door to the US stock market for Chinese-speaking investors and building a bridge between the crypto market and traditional stock markets. With the integration of both, whether it can truly change investors' investment methods and become mainstream in the future remains unpredictable.
I don't know the answer either, but I believe that in the face of an ever-changing market, we should try more cutting-edge and innovative products. After all, investing is a game of strategy, and every decision is a race between the future and opportunity.
This article is from a submission and does not represent the views of BlockBeats.
