Tokenised stocks come with an irresistible vision of the future.
Buy a fraction of Apple from anywhere in the world. Trade it at midnight. Move it between digital wallets. Settle the transaction almost instantly. Perhaps even use it as collateral for a loan without ever leaving the blockchain.
But there is an awkward question at the heart of that vision. Why does Apple need to be tokenised at all?
Apple shares already trade in one of the deepest and most efficient capital markets in the world. Investors can buy fractional shares through conventional brokers. Settlement has become faster. Trading hours are expanding. And putting a digital representation of an Apple share on a blockchain doesn’t create any additional Apple stock.
For Nick Anderson, co-founder of Altcoin Pro and owner of Bullrunners, that is precisely why some of the grandest predictions about tokenised equities miss the point.
“People keep saying $100 trillion of equities is going to move onto crypto rails. It isn’t going to move, because it doesn’t need to. Tokenizing Apple doesn’t create new Apple: same shares, same custodian, same market cap.”
The more interesting transformation, he argues, is happening somewhere less visible.
“The question isn’t whether assets come on-chain, it’s who owns the rails when they do.”
If he is right, tokenised stocks may be less important as a new investment product than as an early test of a much bigger proposition: rebuilding parts of the machinery underneath global finance.
From crypto assets to financial infrastructure
For most of crypto’s history, the direction of travel ran from the blockchain industry towards traditional finance.
Bitcoin acquired futures markets and exchange-traded products. Crypto companies sought bank accounts, licences and institutional custodians. Digital assets were packaged into structures that conventional investors and financial institutions already understood.
Tokenisation reverses that direction. Instead of putting crypto into traditional financial wrappers, stocks, bonds, funds, credit and other conventional assets are beginning to acquire blockchain-based representations.
Vladimir Tikhomirov, co-founder of DeFi infrastructure company Algebra, sees that reversal as significant.
For years, he says, the industry watched attempts to bring crypto into traditional finance through products such as ETFs. Now traditional financial assets are moving in the opposite direction.
“When the markets talk about tokenized assets, they are no longer discussing potential but infrastructure.”
A tokenised Apple share might be interesting to an investor. A common infrastructure on which securities can be issued, transferred, settled, financed and administered could be interesting to the entire financial industry.
The attraction of common rails
Today’s financial system works remarkably well at the surface. Underneath, it is a complex network of exchanges, brokers, banks, custodians, clearing houses, transfer agents and payment systems. Different institutions maintain their own records and spend significant resources making sure those records agree.
Joao Lages, co-founder of tokenised-financial-products platform Lympid, argues that this is where blockchain’s stronger case begins.
Fractional ownership does not require blockchain, he says. Neither, technically, do global access, 24-hour trading or even the appearance of instant settlement. The attraction is putting more of the process onto compatible infrastructure.
“The main argument is how everything can work together in the same tech rails.”
Issuance, settlement, compliance and asset servicing are currently handled across separate systems. Tokenisation offers the possibility of making those functions interact within a common environment.
Courtney Olujobi, Principal at Moon Pursuit Capital, makes a similar point. Many of tokenisation’s headline benefits can be delivered without blockchain, he says. Its stronger case emerges when ownership, transfer rules and settlement can operate within the same programmable system and connect directly with collateral, lending and treasury applications.
That potentially changes what financial infrastructure looks like. Instead of numerous databases recording different parts of the same transaction and reconciling afterwards, the asset itself can become part of the settlement and record-keeping architecture.
The other half of the transaction
An on-chain capital market needs more than tokenised assets. It also needs money.
This is where the rise of stablecoins becomes particularly important. A tokenised security can move on blockchain rails, but a transaction only becomes fully native to that infrastructure if the payment side can move there too.
With a tokenised asset on one side and stablecoins or tokenised bank deposits on the other, it becomes possible to envisage both legs settling together. That opens the door to atomic delivery-versus-payment: the security moves if—and only if—the payment moves with it.
There is also a regulatory reason why that architecture is becoming more plausible now. Mariana de la Roche Wills, founder of BlackVogel, argues that the underlying technology has been available for years; what has changed is the regulatory and institutional groundwork around it. In Europe, tokenised equities remain financial instruments under MiFID II, while the DLT Pilot Regime established a framework for securities to be issued and settled using distributed-ledger infrastructure. MiCA-regulated stablecoins, meanwhile, provide a regulated digital cash leg.
“The technology for this has been available for years,” de la Roche Wills says. “What changed is the regulatory and institutional groundwork underneath it.” The significance, she argues, is that both sides of the transaction can now operate within a regulated framework. “Previously you only had one regulated leg in the puzzle. Now you have both.”
In that reading, the recent acceleration in tokenisation is not principally the result of a technological breakthrough. It reflects regulated securities infrastructure and regulated digital money beginning to converge on compatible rails — a combination that could help explain why institutions that previously remained outside the sector are becoming more comfortable with it.
The significance is less about shaving a day from a retail investor’s stock trade than about what faster, coordinated settlement could mean for collateral, liquidity and the amount of capital financial institutions must keep tied up while transactions complete.
The emerging architecture begins to look less like a crypto exchange and more like a parallel financial stack: digital cash, tokenised assets, programmable settlement and verified participants operating on compatible rails.
A wallet could become something very different
That also changes the role of the crypto wallet. Until now, wallets have largely been associated with holding cryptocurrencies, NFTs and other crypto-native assets.
But what happens if the assets inside them are stocks, bonds, funds and credit instruments instead? Matthias Hauser, Head of Product at Bermuda Institutional Privacy Protocol, describes one possible endpoint succinctly:
“Stablecoins could become the cash balance, tokenised assets the portfolio and the wallet a new kind of brokerage account.”
That possibility goes directly to one of the most interesting questions raised by the growth of real-world assets: whether tokenisation is simply giving existing crypto users something else to trade or bringing a different group of people on-chain.
If people open wallets because they want cryptocurrencies and subsequently add tokenised equities, the sector remains largely an extension of the existing crypto economy.
If people open wallets specifically because those wallets provide access to familiar financial assets they cannot easily obtain through their local financial system, blockchain begins to function as distribution infrastructure rather than as an asset class.
That would represent a very different route to mainstream adoption.
Public stocks may be the least interesting assets to tokenise
There is another reason not to mistake tokenised equities for the destination. Public equities already have functioning markets. Apple does not suffer from a shortage of buyers and sellers. Nor does Nvidia need blockchain to create price discovery.
Other assets are much less fortunate. Private credit, private-company shares, fund interests, real estate and infrastructure investments can be expensive to administer, difficult to divide and cumbersome to transfer. Some have extremely limited secondary markets.
Hauser argues that this is where the implications of tokenisation could become much larger.
“Tokenising a public stock puts an existing liquid asset onto new rails. Tokenising private credit, real estate or fund interests could help create markets that barely exist today.”
Tokenisation cannot manufacture liquidity. There still need to be buyers and sellers, reliable valuations and legally enforceable ownership rights. But reducing the cost and complexity of issuing, administering and transferring an asset could make some previously impractical markets more viable.
Olujobi sees a similar progression.
Equities are an obvious starting point because investors already understand them, she says. But if the infrastructure works, the same model can extend into private securities, credit, funds and other assets that remain comparatively difficult or expensive to distribute.
In that reading, tokenised stocks are the demonstration product. The larger market lies elsewhere.
Programmability changes the proposition
The argument becomes more ambitious again when assets are not merely represented digitally but become programmable. Tikhomirov envisages tokenised assets eventually carrying rules and automated actions that today require separate legal and administrative processes.
An asset could potentially respond to predefined events, automate elements of compliance or transfer according to predetermined conditions.
The concept extends beyond equities. Financial instruments could carry rules governing who is eligible to hold them, how distributions are made, what collateral they can support and how they interact with other financial applications.
That is much harder to replicate when every asset is effectively an entry inside a closed institutional database. And it is here that tokenisation begins to look less like digitising certificates and more like changing the architecture in which financial assets operate.
The old functions don’t disappear
None of this means intermediaries, regulation or financial plumbing simply vanish. Quite the opposite.
Someone still has to establish legal ownership. Assets need custody. Investors need identity checks. Securities laws still apply. Sanctions must be enforced. Markets need liquidity. Corporate actions need to be administered.
Blockchain may change where those functions happen and who performs them, but it does not make the functions unnecessary.
That distinction matters because much of crypto’s early rhetoric imagined disintermediation as the elimination of intermediaries. The emerging tokenisation model looks more complicated.
Banks, exchanges, custodians, transfer agents and clearing institutions may remain central participants—but some of the databases and reconciliation processes connecting them could change substantially.
The revolution, if there is one, may therefore be less about removing Wall Street than changing Wall Street’s plumbing.
And there is a problem blockchain creates
Moving financial markets onto public ledgers also creates challenges that traditional infrastructure does not have in quite the same form. One challenge is privacy.
Public blockchains are designed to make transactions visible. Financial institutions frequently have very good reasons for not wanting their positions, counterparties and trading strategies broadcast to the world.
Hauser argues that institutional on-chain markets will therefore need ways for participants to demonstrate that they have passed identity and compliance checks without revealing their identities, holdings and complete trading histories publicly.
This highlights a broader truth about tokenisation.
The technology does not simply solve existing financial problems. It introduces new ones that the emerging infrastructure must solve in turn.
The decisive question
Tokenised equities are still tiny compared with global stock markets. That alone should temper predictions that the existing financial system is about to migrate wholesale onto blockchains.
But size may be the wrong measure of their significance. The important experiment is whether a financial asset can leave a closed institutional database and operate safely on infrastructure shared by issuers, investors, payments and other financial applications.
If tokenised equities remain primarily offshore wrappers providing price exposure to conventional shares, they could become a substantial crypto product without changing capital markets very much.
If legally recognised ownership itself moves onto programmable infrastructure, the implications are much larger.
Hauser puts the dividing line clearly:
“The decisive question is whether legally recognised ownership itself moves on-chain.”
That is why the current fascination with tokenised stocks may ultimately prove misleading. The breakthrough may be about building an infrastructure in which assets, money and verified investors can interact on common programmable rails.
If that architecture works, public equities may turn out to have been merely the test case. The real story would be what comes next.
