Blockchain Hopes to Revolutionize IPOs, But Can It Truly Replace Traditional Infrastructure?

Changpeng Zhao, founder of Binance, believes that initial public offerings (IPOs) will eventually move onchain. However, moving the IPO itself onchain is a more complicated process than just tokenizing existing securities.

The distinction between tokenized stocks and an IPO lies in the fact that most tokenized stocks today only bring the trading of an existing security onto the blockchain, whereas an IPO starts earlier with a company issuing equity, distributing shares, and granting investors legal rights. The technological infrastructure for issuing and recording shares already exists but is transforming the trading of existing assets much faster than the process through which companies raise capital.

The market for tokenized stocks is growing rapidly, with trading volume on decentralized platforms reaching around $5.8 billion in the second quarter of 2026. However, almost all of this volume came from a single instrument, a tokenized QQQ fund, meaning the market's growth remains highly concentrated.

One advantage of tokenized stocks is that they are easy to understand and allow investors to gain exposure to the price of Nvidia or Tesla through crypto infrastructure and trade when traditional stock exchanges are closed. Demand for trading outside regular exchange hours is already evident, with around 92% of onchain bStocks volume occurring outside regular U.S. stock market hours.

However, tokenized products available today do not provide the same rights as real shares, including voting rights, dividends, and participation in corporate actions. This raises questions about investor rights and conflicts that can arise when holding such instruments does not give an investor rights to actual shares in the company.

Exodus offers an intermediate model where ownership records are maintained by a registered transfer agent, while investors retain the corporate and economic rights of actual shareholders. Figure has gone further by issuing its own SEC-registered common stock directly on a blockchain through the On-Chain Public Equity Network.