Tokenized Stock Boom: Time to Get Rich
Opportunities offered by tokenized stocks
There’s only one way to earn good money with tokenized stocks, I think.
Sure, you can trade them expecting to hit 10x but apart from a few outliers like Micron’s MU 0.00%↑ your chances are slim.
First, only 2,290 stocks are tokenized and just ~130 have larger than a $1M Total Value with most having little to no liquidity onchain.
Strategy is one of the largest with $129M in TV, according to rwa. xyz.
As only established stocks are tokenized right now, you have better chances finding under-looked/under-valued stocks via a tradfi brokerages like IBKR.
Secondly, tokenized stocks expose you to more risks that holding on tradfi brokerages doesn’t.
E.g., buyers of tokenized SPCX stock on PreStocks found out there’s a 180-day lockup before PreStocks can be converted into real shares, leading to a 40% dump.
So you’re exposed to issuer and custody risks, on top of crypto-native smart contract, self-custody (without the benefits of it), and liquidity risks.
Don’t get me wrong, though. Tokenized stocks is one of the most bullish sector for crypto. It brings new users and help keep those who would otherwise offramp to tradfi.
They bring txs onchain and fees with it. They attract VC funding, devs and mindshare to our industry.
Tokenized stocks offer loads of opportunities like earning yield via DEX liquidity pools, using them as collateral, and you can hold SPCX onchain and short via a perp to earn delta-neutral yield as well as perp DEX points.
Speaking of which, you could buy tokenized stock and short on Variational: $VAR is probably the best airdrop opportunity right now:
50% of total supply goes to the community
Points season ends by Sep 30, so ~3.5 months of farming left
Team plans 30% of revenue for buyback & burn once the token is live
Still in private beta
Get 12% boost with my invite code (which is REQUIRED): OMNIIGNAS
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Tokenized Stocks Isn’t Early Investment
However, my biggest qualm with tokenized stocks is that they turn us into exit liquidity for tradfi assets.
Crypto created millionaires because we were early into new sectors: BTC, smart contract platforms, airdrops, NFTs, Hyperliquid airdrop… you name it.
I can’t unsee it with SpaceX IPO.
They seem to run it like a hyped crypto L2 token launch with low-float, high-FDV. Price can go up or down without reflecting fundamentals. In the short term tradfi is going through ‘High FDV is a meme’ stage.
Obviously, the rockets, AI, and Starlink are cool but valuation, unlock schedule, revenue, and governance are not.
The core value of tokenization is wider distribution: anyone with a Phantom/Metamask/Rabby wallet can buy and keep their savings in tokens that are less volatile than BTC or altcoins, and aren’t pegged to USD like stablecoins.
They sit somewhere in between when it comes to risk exposure.
This is a massive value proposition, especially for those outside of the developed markets or those who don’t want/can’t cash out their crypto to tradfi ecosystem.
But that’s not the same as being early.
The beauty of crypto (in the past) was to give retail access to revolutionary companies early.
$2T IPOs aren’t early.
The bullish crypto future is ownership tokenization from the first days of a project.
ICOs and fair launches were great experiments but crypto turned more extractive, especially the last bull run: projects got greedy raising at high valuations and TGEing even higher while public token sale allocations were just a few %.
Cobie explained it well in his blog post.
Actually, I’m still investing via Cobie’s Echo platform because they truly offer early-stage opportunities:
I’m up 3.85x on my MegaETH allocation, despite abysmal MEGA price action post-TGE.
And although the valuation was high, I got into the Series B round of Apptronic - a humanoid robotics company.
Those are opportunities that non-crypto platforms don’t offer to retail investors.
Slightly of topic but besides Echo, Legion is another platform I’m still excited about but they need to source amazing investment opportunities at reasonable valuations.
Not easy.
MetaDAO is great as their Ownership tokens enforce legal claim to token holders, supervise treasury spending via allowances and and unlock tokens based on performance. All key problems that destroy ICOs.
As a result, MetaDAO ICOs perform relatively better adjusted to current market conditions.
Then there’s native issuance, like Superstate’s Opening Bell starting with Galaxy stock, where the equity is actually issued onchain.
Imagine if major companies first issued their equity on Ethereum/Solana instead of blockchains serving as just a wrapper for offchain legal papers.
That would make blockchain immutability and security key priorities thus boosting our bag prices.
That is MetaLeX’s approach: making companies fully programmable onchain. Meaning, that capital, equity, vestings are all done onchain.
Anyway… now even the largest CEXs like Binance, Coinbase, and Kraken are pushing into tradfi with equity, bond, ETF asset offerings.
But Binance, Bybit and Bitget all canceled their tokenized SpaceX offerings after xStocks couldn't deliver the underlying shares, leaving more than $1B in customer orders unfilled.
Better luck putting orders on tradfi brockerages.
In any case, stablecoins that once only had the one main purpose of short-term storage before FOMOing into crypto native assets, now also serve as liquidity as exit liquidity to boomers.
Ok, you can claim that pre-IPO tokenized stocks give you an early access to super duper hot companies like OpenAI and Anthropic.
Indeed, those are the most popular (by MC) pre-IPO tokenized stocks but they trade at close to $1 trillion valuation per company.
That’s not early: Anthropic raised series H at $965B valuation.
A
B
(Strategic round)
C
(Another strategic round)
D
E
F
G
H ← latest round
We’re So Early In Tokenized Equity Boom
Standard Chartered gives $UNI a $100 target. 40x!
Reason?
Tokenized assets in DeFi will go 37x by 2030 (3.5% of supply today to 30%) and $4tn tokenized onchain by 2028.
Tokenized equities account for $1.5B in Distributed Value (can leave the issuing platform, and move peer-to-peer between wallets) as of today. Most on Ethereum, BNB Chain and Solana.
But sector is still small: $1.5B is less than the MC of $UNI token itself ($1.9B)
Besides the fact that Standard Chartered loves quite high price predictions (40k for ETH and 500k for btc by 2030), the logic for UNI is sound: increased TVL of tokenized equities increases trading volumes thus fees to Uniswap which are now used to burn back $UNI.
It’s not just Uniswap.
If tokenized equities boom, the whole crypto ecosystem profits: From Aave, Fluid, Kamino to DEXs on other chains like Pancakeswap, Jupiter 등 등.
Their growth makes crypto anti-cyclical because currently price decrease for BTC/ETH leads into leverage unwind within DeFi which reduces revenues to the protocols thus their tokens also suffer as a result.
Perp DEXs was the first wave that benefited from tokenized equities: spot markets are next.
$UNI pumped 13% on the news but there’re many more opportunities.
In the past 2 weeks, Backpack’s (CEX) BP token pumped by 200%.
Backpack is a CEX that for tried to find its true PMF but got squeezed between established CEXs like Binance and decentralized perps like Hyperliquid.
Their tokenization strategy seems to be that PMF:
Most tokenized stocks, xStocks and Ondo, are custodial wrappers where an issuer holds the share and mints a token that tracks it, so you get the price and not the share.
Backpack issues them natively: through Superstate’s Opening Bell these are real SEC-registered equities issued onchain, same as the Nasdaq listing, with actual dividend and voting rights, and they have the licenses - like FTX Europe (Backpack is founded by ex-FTX employees :)
This extends to their native BP token: staking for more than a year lets you convert BP into company shares at IPO or acquisition (you can unstake in 7-day window).
There are more direct trade opportunities for tokenized equities:
Ondo is 2nd to xStocks by Total Value distributed and already has a token trading.
But $ONDO is a governance token and little else, protocol revenue goes to the company and not holders so a fee switch talks could make it more interesting.
Meanwhile the dilution is rough until 2029: almost 50% still to unlock.
So trading $ONDO if tokenized equity narrative picks up is seductive but holding long term isn’t for me.
xStocks is the market leader, around $1.7B and 60% of the market.
Backed Finance buys the real share or ETF, holds it 1:1 with a custodian, and mints a token that tracks it.
It’s live on Solana, Ethereum (bit on Arbitrum), you trade it 24/5 on Kraken or 24/7 onchain, and there are about 60 tickers. Fewer assets than Ondo but deeper liquidity.
An xStock isn’t ownership of the underlying share, it’s a creditor claim against the issuer. So if something breaks you’re an unsecured creditor of a multi-jurisdiction wrapper, not someone holding stock unlike Backpack.
The saddest thing though is that Kraken bought Backed Finance last year weeks after filing for its own IPO at a $20B valuation.
Which makes the token question genuinely odd.
xStocks launched xPoints program in March, after the acquisition, and points programs are usually a setup for a token, but xStocks hasn’t confirmed one.
So weird because Kraken sell its own equity the normal way, so why would it airdrop a separate xStocks token?
Will it happen?
The likelier reason for xPoints is the Nasdaq-Kraken deal to push tokenized stocks where they need trading volume and liquidity to scale it to pump Kraken numbers?
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Lending: 5x (Kamino)
Holding: 1x base rate
Kraken CEX trades don’t count, onchain activity only
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The 3rd largest is Securitize but I don’t think I will farm it as they are going public via a SPAC merger with Cantor Equity Partners at a ~$1.25B valuation. BlackRock led a $47M round.
No token, no fun.
As I mentioned above, there are multiple opportunities.
E.g., you can short on Hyperliquid (to farm trade. xyz) or Variational, and long spot token if funding is negative. Or even Ostium (still tokenless) to check where funding rate is best.
If manually checking position is too much of a hassle, check out Nado:
(CLOB DEX to offer unified margin between spot, margin, and perps. Nado is from the team that brought you Kraken and deployed INK.)
They should allow delta-neutral strategies as they support Spot and Perps for tokenized equities. Might be a good under the radar farm.
Caution, though:
Ventuals (pre-IPO platform) just announced shutting down while declaring all points worth zero.
Farming airdrop has become more targeted activity that requires more effort than ever before.
Not The End
Like “crypto” term has grown so big to include perps, NFTs, prediction markets, memecoins etc, so is RWA becoming large enough that sector segregation deserves deep dives.
From stablecoins, money funds, credit, private equity, and tokenized stocks, they have different risks and rewards.
The unique factor of tokenized stocks is their velocity: due to price volatility of equities they bring arbitrage and trading opportunities that passive RWAs don’t.
This, I believe, could bring revival to trading chains, especially Solana (I tend to treat Ethereum as ‘storage’ chain for high value but passive investments).
As Solana depended on memecoins I wonder if a new narrative for trade-anything-onchain for Solana can get steam.
E.g., tokenized equity dominates trading volumes on Solana. It’s cheap, fast and UX is better than on EVM chains.
Millions of retail could end up holding and trading tokenized equity instead of stablecoins on mobile phones, increasing revenue thus valuations for our heavy L1 tokens.
Overall, I believe the real way to get rich with tokenized stock is betting on their adoption onchain:
which companies, issuers, platforms will dominate in the next 1, 3, 5 years?
Which will airdrop tokens? Or perhaps the trades are in front of our eyes and we should just bit UNI, BP, ONDO, or wait for Kraken IPO?
Share your thoughts below!
See you later.