SEC Clarifies Status of Tokenized Stocks in US
Tokenized stocks are blockchain-based representations of shares in publicly traded companies. They allow ownership to be recorded on a digital ledger, rather than just in conventional brokerage and securities databases.
This does not mean that companies like Apple or Nvidia have become cryptocurrencies. A tokenized stock remains a security regardless of how its ownership is represented.
According to the SEC, there are two main ways for stocks to be tokenized: issuer-sponsored tokenization and third-party tokenization. In issuer-sponsored tokenization, the company itself integrates blockchain technology into its shareholder record. This allows for direct onchain transfers and updates to the master ownership record.
Ondo Stocks is one example of a company that offers tokenized stocks and ETFs to eligible investors outside the US. Its products are backed by traditional shares held through US financial institutions, but can be transferred through blockchain networks like Ethereum or Solana.