Tokenization stocks grow as US companies push back

Trading in so-called tokenized stocks is gaining momentum in international markets, even as major U.S. companies resist its adoption domestically.

Trading activity centered around blockchain-based versions of traditional financial assets, including stocks, is growing, according to Bitwise Asset Management’s latest quarterly staking report released on Tuesday. On the Robinhood Chain, the brokerage firm’s newly launched network for users and AI agents to trade various assets on-chain, trading volume of tokenized stocks jumped from $526 million in July to $2.21 billion in August, and to $11.31 billion in September.

In the quarter, the non-cryptocurrency market accounted for 36.5% of Hyperliquid’s perpetual trading volume, up from 32.7% in the previous quarter. Tokenized stocks were also the fastest growing category at Solana.

meanwhile, goldman sachs, microsoft, Qualcomm, caterpillar, mcdonalds, western digital and alphabet Tokenized stock exchanges jointly launched crypto exchange OKX and Intercontinental Exchange, the parent company of the New York Stock Exchange, as they object to tokenized versions of their stocks being traded on the OKXICE platform.

OKXICE disclosed its objections in a public notice Monday, adding them to a group of previous opponents including: core weave, united health, broadcom, applied digital, App Lovin and cerebrum.

This contrast highlights the cryptocurrency industry’s growing debate and challenge of how to convince companies that it is worth adopting stock tokenization transactions. Given the potential of blockchain technology to improve the accessibility and liquidity of financial assets overall, tokenization – the process of issuing publicly traded securities, real-world assets, or other forms of digital representation of value on blockchain networks – has become a topic of great interest in the market.

Questions have also been raised about what entitlement tokens should offer their owners. The debate centers on whether investors should receive the same economic and shareholder rights as traditional stocks, especially voting rights. The issue first came into focus in September after a public spat between Robinhood and AMC’s CEOs over Robinhood’s stock token model.

Trading in tokenized stocks is currently concentrated overseas, where tokenized products are more widely available. But crypto industry watchers are watching to see if U.S. adoption accelerates after the SEC last month issued an innovation exception that creates a temporary pathway for tokenizing stocks in the United States. This should allow companies to object to their shares being represented as tokens.

“The divergence comes down to what is actually being traded,” said Mirza Uddin, chief operating officer at Injective. “Offshore, most of this activity is price exposure through on-chain purp or wrapped tokens that don’t require corporate permission, whereas the US framework seeks to put real stocks on-chain, giving issuers a say.”

“Right now, companies like Goldman and Microsoft see all the risks and none of the benefits. It’s a token with opaque voting rights and no 24/7 trading control,” he added. “Until the industry shows issuers what they’re getting: a global shareholder base and a market that never closes, growth will continue to occur overseas while the U.S. debates license revocation.”

ClearStreet analyst Owen Lau said companies may not yet fully understand the benefits of tokenization, and he expects some will eventually adopt it.

“Some companies may or may not be for this, citing benefits such as a wider investor base, 24/7 access, and more distribution channels. Some of the less traded and tattered stocks could be good candidates,” he said.

In addition, companies will also benefit from increased visibility, direct dividend payments and cost reductions, Lau explained. For investors, tokenized assets also serve as collateral for decentralized finance (DeFi) platforms, offering greater flexibility and control.

“This is a very natural reaction. This model was designed to give businesses the right to decide whether to opt in or opt out. This is such a dramatic and revolutionary change that we always expected many businesses would want to wait and see rather than participate first,” OKXICE co-chairman Andrew Cuomo said in a statement.

“The SEC model is designed to accommodate both approaches,” he added. “There are limits to the number of companies that can participate and the amount they can trade…We’re going to see both reactions depending on the companies, their attractiveness to global markets, and the locations they choose.”

As of Wednesday, 16 companies have opposed trading tokenized versions of their stocks on OKXICE. This does not mean that they and other companies oppose tokenization by all companies involved, but it does highlight their resistance to having their shares traded through this particular model and location.

OKXICE initially announced that it would make over 60 tokenized stocks available for trading on its platform on October 4th. Pursuant to the SEC’s Innovation Exemption, venues must notify companies of their intent to tokenize their shares and begin trading the tokens within 30 days of the company receiving the notification.

“The disconnect is not driven by US vs. non-US, it’s driven by investors vs. issuers,” Lau said. “There is a global demand…This is where the industry can articulate more clearly the benefits to issuers that they can actually reap if they tokenize their stocks.”