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BTC 
ETH Tokenized stocks: A wave of round-the-clock trading in niche markets
Although the market size of tokenized stocks is still small, its traders do not follow the traditional Wall Street routine. According to the latest Global Financial Stability Report released by the International Monetary Fund (IMF), more than half of tokenized equity transactions occur outside regular U.S. stock market trading hours. In addition, about 80% of transactions involve less than one share, reflecting strong demand for fragmented ownership among retail investors.
Blockchain-based price discovery and information transmission
Tokenized stocks are blockchain-based tokens designed to track the performance of listed companies 'shares. Over a 365-day period, the IMF studied the five most liquid U.S. tokenized stocks in 11 trading venues, including tokens tracking Tesla, Nvidia and the S & P 500 index. The data shows that prices on the chain contain real information. The IMF found that when traditional markets reopened, traditional stocks absorbed 87% to 99% of the overnight price fluctuations of their tokenized counterparts.
Challenges of high volatility and illiquidity
However, the shortcomings in this area are equally obvious. The volatility of tokenized stocks is about 1.5 times that of underlying stocks, and the liquidity is much lower than that of traditional stocks. Especially in decentralized exchanges, prices deviate more from traditional markets. In addition, the market is small and highly concentrated: a total market value of approximately US$2.3 billion, of which xStocks issued by Ondo Finance and Backed Finance account for more than 70% of the market. According to the IMF, the synthetic tokens issued by the two institutions provide price exposure but do not involve direct shareholding.
Regulatory advice and industry expansion
Given that the market is still in its early stages, the IMF said its findings "should be interpreted with caution" and that systemic risks remain limited. The IMF is urging regulators to consider setting up circuit breakers for 24/7 trading and more closely monitor its links to traditional markets. Earlier this year, the IMF warned that tokenized finance and stablecoins could amplify the financial crisis.
At the same time, major U.S. financial institutions are racing to enter the tokenization arena. The New York Stock Exchange (NYSE) plans to reach crypto investors through Blockchain.com;NYSE parent company ICE is working with OKX to conduct 24/7 tokenized stock trading under the U.S. Securities and Exchange Commission (SEC)'s new innovation exemption framework. Securitize has also recently introduced tokenized stocks including Nvidia, Apple and Amazon to the Solana network, and will support more blockchain networks in the future. Cboe has reached an agreement on tokenized options for the S & P index, and Coinbase launched a tokenized stock service for non-U.S. users on the Base network in August.
