With the rapid development of blockchain technology, the tokenized stock market is expanding at an unprecedented pace, attracting widespread attention from global regulators and industry organizations. Recently, the World Federation of Exchanges (WFE) wrote to securities regulators expressing concerns about blockchain-based tokenized stocks, urging regulators to strengthen oversight of this emerging field to protect investors and maintain market stability.
The Rise of Tokenized Stocks and Regulatory Challenges
Tokenized stocks refer to the digitization of traditional stocks through blockchain technology, allowing them to be traded in token form on digital platforms. This new type of asset has rapidly gained popularity worldwide. According to CoinGecko, since the beginning of 2024, the market size for tokenized real-world assets (RWA) has grown by nearly 300%, with an added market capitalization of over $8.6 million. Investment platform Robinhood launched tokenized U.S. stocks and ETFs in June, and centralized exchanges like Kraken have also begun offering similar services. Even Coinbase plans to tokenize its $COIN stock, demonstrating the active participation of industry giants in this trend.
However, the rapid development of tokenized stocks has also brought new challenges. The WFE warns that if token issuance fails, the issuing institutions may face 'reputational damage.' Furthermore, the WFE calls on regulators to clarify the legal framework for ownership and custody of tokenized stocks and to prevent these products from being improperly marketed as equivalents to traditional stocks. While the WFE did not specifically name the brokers or trading platforms involved, its concerns reflect the industry's general apprehension about the potential risks of tokenized stocks.
Regulatory Stance: Tokenized Securities Are Still Securities
The U.S. Securities and Exchange Commission (SEC) has a clear regulatory stance on tokenized stocks. In July 2025, SEC Republican Commissioner Hester Peirce, nicknamed 'Crypto Mom' for her open attitude towards cryptocurrency, stated that the essence of tokenized securities remains unchanged, regardless of whether they are based on blockchain technology. She emphasized, 'While blockchain technology is powerful, it does not possess the magical ability to change the nature of the underlying asset. Tokenized securities are still securities.' This means that tokenized stocks must comply with existing securities regulations to ensure transparency in trading and protection for investors.
The Value and Limitations of Tokenized Stocks
Despite the rapid growth of the tokenized stock market, industry insiders have differing opinions on its intrinsic value. Kevin Rusher, co-founder of RAAC, pointed out that simply tokenizing stocks offers little additional intrinsic value apart from providing a digital representation. However, the emergence of tokenized stocks is changing the perception and utilization of traditional assets in the digital economy, providing investors with greater liquidity and a more convenient trading experience. The increasing participation of institutions also indicates that tokenized stocks are gradually becoming an important part of the financial market.
Future Outlook
The rapid development of tokenized stocks presents innovative opportunities for the financial industry while also imposing new requirements on the regulatory framework. The WFE's call indicates that global regulators need to accelerate the establishment of clear rules to balance innovation with risk. In the future, as blockchain technology matures further and the regulatory environment improves, tokenized stocks are expected to play a more significant role in the digital economy. However, ensuring market stability and protecting investor rights while promoting innovation remains a challenge faced by regulators and industry participants alike.
In summary, the rise of tokenized stocks marks a deep integration of traditional finance and blockchain technology. Although the market outlook is broad, sustainable development in this emerging field can only be achieved under a clear regulatory framework and robust risk management.
