In less than two years, the tokenized securities market experienced almost “explosive” growth. According to RWA.xyz data, the total Market Cap of RWA (real world assets) tokenization has now surpassed $2.8 billion, with on-chain stocks reaching $0.42 billion — yet at the beginning of 2024, this figure was less than 5 million dollars, surging more than 80 times in just two years.
What is driving this wave is the collective entry and accelerated layout of enterprises: Robinhood launched tokenized private equity products, covering popular targets such as SpaceX and OpenAI; Kraken's xStocks has launched tokenized versions of more than 50 US stocks and ETFs; Ondo's Wall Street 2.0 has launched more than 100 US stocks and ETFs on Ethereum; Galaxy Digital took the lead in moving its NASDAQ listed stocks to the public chain ; SBI Holdings teamed up with Startale to establish an on-chain trading platform in Japan. Both crypto-native companies and traditional financial giants are vying for a first-mover advantage in the emerging circuit of tokenized stocks.
This is not only a race between crypto and traditional finance, but also seen as a potential “revolution” against the traditional exchange model. On September 8, Nasdaq, the world's second-largest exchange, chose to take the initiative and submit an application to the US Securities and Exchange Commission (SEC) to officially embrace tokenized stocks in an attempt to push this transformation from “edge testing” to the core stage of Wall Street.
New packaging under the old system: the running logic of tokenized stocks
Tokenized stocks are not a new Assets that appeared out of thin air; they are a new “packaging” for traditional equity. Its key is how to connect blockchain's bookkeeping and settlement capabilities on top of existing financial infrastructure. In the rule proposals submitted by Nasdaq to the SEC, this logic is expressed very clearly: in the future, investors can select the “tokenized settlement” option in the system when placing orders, and transaction matching will still be completed in the same order book, and no additional priority will be given due to tokenization. The real change comes after the transaction — NASDAQ will pass on settlement instructions to the Depository Trust Company (DTC), which will transfer traditional Stocks into a special account, mint equivalent tokens on the chain, and then distribute them to the brokers' wallets. As a result, tokenized stocks are completely consistent with traditional stocks in the transaction process, and on-chain mapping has only been introduced at the settlement layer.
This design means that tokenized stocks are not isolated from the National Market System (NMS), but are incorporated into the existing regulatory and transparency framework: transactions are still included in the National Best Trading Quote (NBBO), ownership and voting rights are completely consistent with traditional stocks, and transaction monitoring is carried out jointly by NASDAQ and FINRA. In other words, tokenization is not a “fresh start” here, but an upgrade to the underlying infrastructure. “We're not trying to replace the existing system, but rather provide the market with another more efficient and transparent technology option.” “Tokenized securities are just the same assets expressed in a new form on the blockchain,” said Chuck Mack, Nasdaq's senior vice president of North American Markets in an exclusive interview. It can not only utilize the existing market structure and clearing system, but also make blockchain a next-generation escrow and settlement tool.
From a broader perspective, the appeal of tokenization is that it has touched several core pain points in the capital market. The first is settlement efficiency — in the current system, Stocks transactions usually take T+1 or longer to complete delivery, while on-chain settlement can almost achieve real-time settlement, reducing counterparty risk. The second is transaction time and accessibility — traditional Exchange follow a market opening and closing system, and cross-border investments still require layers of intermediaries, while tokenized stocks can theoretically be traded 24/7 and are easier to reach overseas investors through blockchain wallets. Finally, there is the programmability of assets, which means proxy voting, dividend distribution, and even corporate governance can be automated and transparent with the support of smart contracts.
In the long run, Nasdaq has positioned tokenization as the next iteration of Capital Markets infrastructure. According to the plan, with the completion of the DTC upgrade, the on-chain settlement function will be implemented as early as the third quarter of 2026. In this year, cryptocurrency stocks will run parallel to traditional stocks in the regulated US market. NASDAQ clearly refuses to proceed with exemptions or detours, which not only upholds the principles of investor protection, but also avoids the risk of liquidity fragmentation.
Path differences for different players
xStocks: Compliance Custody + DeFi Composability
xStocks is driven by Backed Finance. It relies on the DLT Act of Swiss Franc and Liechtenstein to establish SPVs to hold real Stocks and then mint tokens on the public chain at a 1:1 basis. Legally, tokens are preferential claims with Assets guarantees, backed by a custodian and a real-time reserve certificate. The issuer side is separated from the transaction side, and tokens can be distributed on centralized Exchange such as Kraken and Bybit, as well as connected to Solana's DeFi protocols such as Jupiter and Kamino. The highlights of this model are openness and transparency, and it is truly compositional across markets and agreements, but the downside is that liquidity is still limited, and the market size is not comparable to that of an off-chain market.
Robinhood: A closed-loop on-chain experiment with a licensed brokerage firm
Robinhood followed a completely different path. It relies on the Lithuanian subsidiary's MiFID II license to purchase and host US stocks, ETFs, and private equity under a compliance framework, and then mint corresponding tokens on the Arbitrum chain. All token transactions are completed in a closed loop within Robinhood's own app, and tokens and real stocks are mapped in real time to ensure “on-chain quantity = escrow position”. The advantages of this model are controllable supervision, consistent user experience, and can even achieve odd lot and on-chain clearing, but tokens can hardly be freely transferred, and there is no open liquidity. Robinhood sees tokenization as a tool to expand its financial landscape rather than simply innovating the market.
Galaxy: A self-on-chain “native token” for listed companies
Unlike the previous two, Galaxy Digital chose to move its Stocks listed on NASDAQ directly onto the chain. It partnered with SEC-registered transfer agent Superstate to allow Shareholder to convert GLXY common shares 1:1 into tokenized shares on Solana through a compliance process. Unlike “mirror tokens” or “synthetic contracts,” these tokens are real shares in the legal sense and enjoy full voting and dividend rights. Galaxy's experiment achieved “the same rights as a token and Stocks” for the first time, laying the foundation for a true on-chain equity market. However, its liquidity is still in its infancy. For the time being, it only supports peer-to-peer transactions between registered users, and further deregulation is needed until the full secondary market is complete.
Ondo: Building Wall Street 2.0
Ondo Finance was founded by a former Goldman Sachs executive and followed the path of “Institutions packaging + open distribution”. The newly launched Ondo Global Markets platform has tokenized more than 100 US stocks and ETFs to Ethereum, providing a legal on-chain investment portal for non-US investors. The model is: Ondo buys and hosts real Stocks through licensed brokers, and then mints tokens 1:1 on-chain to ensure that each token has full financial rights, including dividends and corporate actions. Ondo's highlights are scale and openness — it not only has daily reserve certificates, bankruptcy isolation, and third-party escrow, but also supports cross-chain interoperability and DeFi combinations. Users can not only invest in star stocks such as Apple and Tesla, but also use tokens as collateral to participate in lending and automation strategy. Ondo has made tokenization a kind of “global financial supermarket,” trying to combine the liquidity of Wall Street with the transparency of blockchain to create Wall Street 2.0 in the true sense of the word.
Related reading: “From Robinhood to xStocks, how was the tokenization of US stocks achieved?”
A hug or an adventure? Wall Street's on-chain test
Nasdaq has officially submitted an application for tokenized Stocks trading with the SEC, which is seen as a “core attempt” by Wall Street in the digitalization process. The core of this proposal is that tokenized stocks should enjoy exactly the same rights and protections as their underlying securities, transaction matching is still carried out in the existing order book, and DTC is responsible for minting equivalent tokens on the chain. This means that tokenization is no longer an experiment of marginalization, but may become part of the institutional infrastructure of the US Capital Markets. Compared to Robinhood or xStocks, which remain stuck in the price mapping and contract certificate model, Nasdaq's path is more thorough — it became the first tokenized solution to completely migrate all Shareholder rights (voting rights, dividend rights, governance rights) to the chain. This means that what investors get is no longer a “shadow” of the Stocks, but the digital Stocks Ontology with full rights.
Nasdaq CEO Tal Cohen said, “Blockchain technology offers unprecedented possibilities for shortening settlement cycles, modernizing proxy voting, and automating corporate actions.” In other words, NASDAQ is not trying to overthrow the old order, but rather wants to upgrade the underlying structure of the market through minimal institutional friction and ensure that the core principles of investor protection and market transparency remain unwavering. For regulators, this attitude sends a Bullish Signals — instead of letting tokenization grow savagely overseas or in grey areas, it is better to directly incorporate it into the regulated framework.
However, negative voices also exist. J.P. JPMorgan stated bluntly in the Research Reports that tokenization of Bonds and stocks “has yet to be significantly adopted outside of cryptographic native companies,” reminding the market not to overexaggerate short-term prospects. Citadel Securities, on the other hand, warned that if Institutions push ahead in a hurry and do not establish clear rules, it may cause market risk. Globally, the World Federation of Exchange (WFE) has also sent letters to Institutions, concerned that tokenized stocks “mimic” real equity, but may lack Shareholder rights and safeguards, and demand strengthened legal application and custody frameworks. These questions suggest that although the potential for tokenization is huge, the implementation of the system will still require a long run-in period.
summed
The Nasdaq proposal was not only a technical adjustment, but an institutional “test of the waters.” If finally approved by the SEC, this will mark the first time blockchain technology has taken a central position in the mainstream US stock market and could lay the foundation for future round-the-clock trading, instant settlement, and smart contract governance. But before all of this actually happens, the market still needs to be seen: whether regulation can provide a clear framework, whether investors can trust this new model, and whether tokenization can actually bring value beyond traditional markets.
