Blockchain-based equities gain traction amid regulatory uncertainty
XStocks, a tokenized stock platform developed by Backed Finance, has officially launched on Ethereum, bringing around 60 tokenized equities to the world’s leading smart contract network. The list includes major companies like Nvidia, Tesla, Meta, Amazon, and Walmart, according to a statement released on Tuesday.
Previously available on Solana, BNB Chain, and Tron, the move to Ethereum marks a strategic expansion. “Ethereum is one of the world’s most widely adopted smart contract networks — and xStocks were built to meet users where they already are,” a Kraken representative noted.
Ethereum continues to dominate decentralized finance (DeFi) with a total value locked (TVL) of $90.8 billion, representing 60% of the overall blockchain TVL. This makes it a natural hub for tokenized stock offerings.
What Is Tokenized Stock Trading?
Tokenized stocks represent digital versions of traditional equities, such as shares of tech giants, hosted on a blockchain. Unlike traditional ownership, investors in tokenized stocks do not gain direct voting rights or legal claims on company assets, raising concerns among regulators.
Legal experts warn that tokenized equities remain in a regulatory gray area. Global stock exchanges and watchdogs, including the U.S. Securities and Exchange Commission (SEC), are pushing for stricter oversight.
Market Growth Despite Challenges
Despite scrutiny, demand for tokenized equities is growing. According to RWA.xyz, the tokenized stock market capitalization is approximately $342 million, just 1.2% of the $27.9 billion tokenized RWA market.
Industry advocates argue that tokenization democratizes access to financial markets by removing traditional barriers. Still, the lack of legal protections and ongoing regulatory uncertainty continue to fuel debate.
As adoption accelerates, Ethereum’s position as the leading DeFi chain could solidify its role as a hub for tokenized real-world assets, even as regulators weigh in on the future of blockchain-based equities.
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.