Tokenized Stocks Failed Their Biggest Test: Here’s How to Fix It
Intro
With asset tokenization platforms, many fintech optimists predicted that ordinary retail investors would finally have a seat at the table previously reserved for venture capital funds and accredited insiders. Tokenized shares issued before IPOs reflect the value of private companies like SpaceX, OpenAI, and Anthropic, among others. They were positioned as a bridge between the traditional Web2 stock market and the Web3 infrastructure. This isn't even the first attempt in the industry to implement such an idea. Back in April 2021, Binance launched tokenized versions of Tesla, Apple, Coinbase, and several other publicly traded companies.
The experiment lasted three months. By July 2021, European regulators BaFin and the UK's FCA made it clear that the tokens closely resembled unlicensed securities, and Binance withdrew the product entirely, giving holders 90 days to withdraw their funds. The takeaway for the industry from this round was simple: such a product cannot...
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