Crypto Tokens Face Identity Crisis as Companies Seek to Link Ownership to Equity

The crypto industry has been grappling with a fundamental issue for over a decade: tokens are not shares. They can govern protocols, unlock discounts, and signal membership in communities, but they do not entitle holders to dividends, votes, or claims if the company goes bust.

Recently, three companies have attempted to bridge this gap from different directions, forcing the question: if company ownership can exist on a blockchain, what are crypto tokens actually for?

Centrifuge Labs, one of the earliest tokenisation platforms with over $2 billion in real-world assets tokenised, has proposed converting its CFG governance token into equity. The proposal, which is still in its comment stage, would see the non-profit foundation behind Centrifuge re-registered as a Cayman Islands exempted company.

The conversion ratio would be one share for each token transferred, with holders of 100,000 CFG or more entering the share register directly. Smaller holders would participate through an intended arrangement with CoinList. The community response has been pointed, with demands for an independent valuation behind the conversion ratio and a fully diluted cap table.