A comprehensive analysis of tokenization of US stocks: how far are we from a true market revolution?

The tokenized U.S. stock market is growing rapidly, with giants such as Kraken, Coinbase, and Solana laying out. This article provides an in-depth analysis of existing players and potential product solutions, discusses their value propositions, regulatory challenges and market prospects, and lists relevant investment targets to reveal the opportunities and challenges in this emerging field. This article was written by Lawrence Lee, a researcher at Mint Ventures, and was compiled, compiled, and contributed by Odaily. (Synopsis: U.S. stock tokenization outbreak: Bybit, Robinhood, Kraken start simultaneously, the biggest narrative of this cycle is born? (Background addition: Bybit launches xStocks tokenized stocks, widens the bridge to Wall Street) Recently, there have been many developments in the field of tokenized US stocks: Centralized exchange Kraken announces the launch of tokenized stock trading platform xStocks centralized exchange Coinbase announces seeking regulatory permission for its tokenized stock trading Public chain Solana submits a blockchain-based framework for tokenized US stock products The US-backed public chains and exchanges are accelerating the process of tokenizing U.S. stocks, and coupled with the recent frenzy after Circle’s listing, people have to look forward to the prospect of tokenized U.S. stocks. In fact, the value proposition of tokenized U.S. stocks is pretty clear: 1. Expanded the size of the trading market: providing a 24/7, borderless, permissionless trading venue for US stock trading, which is currently impossible for NASDAQ and NYSE (although NASDAQ is already applying for 24-hour trading, it is expected that it will take the second half ×of 26 years to achieve it) 2. Superior composability: By combining with other existing Defi infrastructure, U.S. stock assets can be used as collateral, margin, index construction, and financial products, deriving many ways of playing that are currently unimaginable The needs of both supply and demand sides are also clear: Supply side (US listed companies): Through the borderless blockchain platform, it has reached potential investors from all over the world and obtained more potential buyers Demand side (investors): many investors who have not been able to directly trade US stocks for various reasons in the past, U.S. stock assets can be directly allocated and speculated through blockchain Quote from “U.S. Stock Chain and STO: A Hidden Narrative” In this round of tolerant crypto regulatory cycle, progress is a high probability event. According to RWA.xyz data, the current market capitalization of tokenized shares is only $321 million, and there are 2,444 addresses that hold tokenized shares. The huge market space contrasts sharply with the current limited asset size. In this article, we will introduce the product solutions that analyze the current players in the tokenized US stock market and other players who are promoting tokenized US stocks, and list potential investment targets under this concept. This article is the author’s periodic thinking as of the time of publication, the future may change, and the views are highly subjective, there may also be facts, data, reasoning logic errors, all views in this article are not investment advice, welcome the industry and readers criticism and further discussion. According to rwa.xyz data, the tokenized stock market currently has the following items by issuance size: We will walk through the business models of Exodus, Backed Finance and Dinari (Montis Group for European stocks, SwarmX business is similar to Backed Finance but smaller), as well as the progress of several other important players who are currently making tokenized US stock business referrals. Exodus Exodus (NYSE. EXOD) is an American company specializing in the development of non-custodial crypto wallets whose shares are listed on the New York Stock Exchange (NYSE. EXOD)。 In addition to its own brand wallet, Exodus has also partnered with NFT marketplace MagicEden to launch a wallet. As early as 2021, Exodus allowed users to migrate their common shares to the Algorand chain through Securitize, but the tokens migrated to the chain cannot be traded or transferred on the chain, nor do they contain governance rights or other economic rights (such as dividends), Exodus tokens are more similar to the “digital twins” of real shares, and the symbolic meaning on the chain is greater than the actual meaning. EXOD is currently worth $770 million, of which about $240 million is on-chain. Exodus was the first stock to be approved by the SEC to tokenize its common stock (or more precisely, Exodus was the first tokenizable stock approved by the SEC to list on NYSE), although the process was not all smooth sailing, and the listing of Exodus stock began in May 24 and was delayed until December when it was officially launched on NYSE. However, Exodus’ stock tokenization is only for its own shares, and the tokenized shares cannot be traded, which means little to us web3 investors. Dinari Dinari is a US-domiciled company that was founded in 2021 and has focused on stock tokenization under the US compliance framework since its inception, and completed a $10 million seed round in 2023 and a $12.7 million Series A round in 2024, with investors including Hack VC and Blockchange Ventures, Coinbase CTO Balaji Srinivasan, F Prime Capital, VanEck Ventures, Blizzard (Avalanche Fund), etc. Among them, F Prime is a fund owned by asset management giant Fidelity, and the investments of Fidelity and VanEck also show the recognition of the tokenized US stock market by traditional asset management institutions. Dinari only supports non-US users, and its process for trading US stocks is as follows: The user completes KYC The user selects the US stock they want to buy and pays USD+ issued by Dinari (a stablecoin backed by short-term Treasury bonds issued by Dinari, which can be exchanged by USDC) Dinari submits the order to the partner broker (Alpaca Securities or Interactive Brokers), and after the broker completes the order, The shares are kept in the custodian bank, and Dinari mints the corresponding dShares for users At present, Dinari conducts business in Arbitrum, Base and Ethereum mainnet, all dShares have a real-world equity 1 to 1 correspondence, users can view their dShares corresponding equity through Dinari’s official website, and Dinari can also make dividend distributions or stock splits for users who hold its dShares. However, dShares cannot be traded on the chain, and if you want to sell dShares, you can still only trade through the official website of Dinari, and the actual transaction process is the reverse of the purchase process. dShares transactions must also follow U.S. trading hours and cannot be bought or sold outside of trading hours. In terms of product form, in addition to direct…