#stock-tokenization

➤ Binance Research projects stock tokenization could unlock $2 trillion in new market capital and attract 300 million new investors by 2031. ➤ This growth is driven by crypto exchanges offering lower barriers to entry, fractional ownership, and 24/7 trading, particularly appealing to emerging markets. ➤ However, regulatory clarity, user adoption, and market growth are critical factors for realizing these projections.

➤ Binance has acquired a strategic stake in Alpaca, the dominant U.S. custodian for tokenized stocks and ETFs, marking its entry into the RWA tokenization market. ➤ The deal includes a significant revenue-sharing agreement for Payment for Order Flow (PFOF) and stock lending fees, indicating a deep operational partnership. ➤ This partnership is expected to enhance liquidity for tokenized real-world assets and signals a growing convergence between traditional finance and blockchain technology.

➤ The SEC has proposed a plan to allow stock trading on the blockchain, enabling 24/7 trading of tokenized equities. ➤ Prominent figures like Michael Burry and Ken Griffin (Citadel Securities) have voiced strong opposition, citing concerns about market fragmentation and potential loss of shareholder rights. ➤ The proposal includes an 'innovation exemption' for tokenized stocks, but critics argue these tokens may not represent true corporate ownership and could lead to price divergence between traditional and blockchain markets.

➤ The SEC has postponed its planned exemption for tokenized stock trading, which was expected to allow tokenized stocks to trade on DeFi platforms. ➤ The exemption was intended for third-party issued tokens, covering both full ownership tokens and synthetic stocks, but faced resistance due to concerns about executing corporate actions and anonymity. ➤ SEC Commissioner Hester Peirce clarified that the planned exemption is not for synthetic stocks and would be of limited scope, indicating ongoing regulatory hurdles for broader stock tokenization.