Experts Warn That Combining Blockchain Stocks With Volatile Crypto Assets May Expose Investors to Double Risk
As digital asset treasuries (DATs) explore new ways to attract investors, some crypto executives are warning that tokenizing company shares could intensify financial risk rather than reduce it.
According to Kadan Stadelmann, Chief Technology Officer at Komodo, the fundamental mismatch between traditional market hours and 24/7 blockchain trading presents a serious challenge.
“Blockchains trade nonstop, but traditional markets don’t. Sudden onchain price swings outside market hours could trigger a sell-off of tokenized shares before a company has time to react,” Stadelmann explained.
He added that smart contract vulnerabilities — including hacks, code exploits, or loss of custody — further compound the risk to investors holding both traditional and tokenized versions of a company’s equity.
A “Synthetic on Top of a Synthetic”
Kanny Lee, CEO of SecondSwap, described tokenizing DAT equity as “creating a synthetic on top of a synthetic.”
“Investors end up exposed twice — first to the volatility of the treasury’s crypto holdings, and again to the complexity of corporate equity and securities law,” Lee said. “That’s a lot of risk layered on already volatile assets.”
This dual exposure, executives warn, could lead to amplified losses during high-volatility events, particularly for companies whose balance sheets are heavily weighted in digital assets.
Nasdaq president Tal Cohen announces the push for 24 hour stock trading. : Tal Cohen
Regulators and Exchanges Eye Tokenized Equity Markets
Despite the concerns, tokenized stocks have already surpassed $1.3 billion in value, signaling rising market interest. The U.S. Securities and Exchange Commission (SEC) has begun exploring blockchain-based stock trading systems to modernize markets that still pause on nights, weekends, and holidays.
Major exchanges are also adapting. Nasdaq recently announced plans for 24-hour stock trading, five days a week, expected to launch in the second half of 2026, to align with crypto’s always-open markets.
While tokenization promises faster settlement and global accessibility, experts caution that mixing volatile crypto assets with corporate equity could magnify instability. Until clear regulations emerge, investors in tokenized DAT shares may face a higher-than-expected level of risk — both onchain and offchain.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.
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