Tokenized stocks have the potential to fundamentally transform global financial markets by enabling round the clock trading, faster settlement, and broader access to equities, according to Brian Armstrong. Speaking about the future of capital markets, the chief executive of Coinbase said that putting equities on blockchain rails could remove many of the structural limits that define today’s stock markets. Tokenization would allow shares to trade continuously rather than during fixed market hours, enable fractional ownership for global investors, and settle transactions in real time rather than over several days. Armstrong also pointed to the possibility of new financial instruments emerging onchain, including perpetual equity derivatives and governance mechanisms that give token holders a more direct role in corporate decision making. Together, these changes could significantly alter how capital is allocated and how investors interact with public companies.
Supporters of tokenized equities argue that the model reduces reliance on intermediaries and lowers barriers for international participation, particularly for retail investors who have historically faced high costs or limited access to certain markets. Recent data shows that transfers involving tokenized equities reached roughly 2.46 billion dollars last month, highlighting growing interest in the concept even as regulation remains uneven. Advocates believe blockchain based settlement could reduce counterparty risk and operational friction while making markets more transparent. At the same time, critics caution that many current tokenized stock offerings are not issued directly by the underlying companies, effectively functioning as synthetic representations rather than legally equivalent shares. This distinction raises concerns around enforceability, shareholder rights, and settlement finality, especially if legal claims remain anchored off chain while trading activity occurs onchain.
The debate underscores broader tensions between innovation and regulation as tokenization expands beyond crypto native assets into traditional securities. Some legal scholars and market observers warn that without clear frameworks, tokenized stocks could resemble side bets on equity performance rather than true ownership, exposing investors to unfamiliar risks. Questions remain around how dividends, voting rights, and corporate actions would be handled in a fully tokenized environment. Armstrong acknowledged that regulatory clarity will be essential but framed tokenization as a long term evolution rather than a near term replacement for existing systems. As part of that vision, Coinbase is pursuing plans to build an integrated trading platform by 2026 that would allow users to trade cryptocurrencies, equities, and commodities in a single venue. Whether tokenized stocks become a core pillar of global markets or remain a niche product will likely depend on how effectively legal rights, compliance, and enforcement can be aligned with the speed and flexibility of blockchain infrastructure.
