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SEC Moves to Allow Tokenized Stocks for On-Chain Trading in Web3coincentral.com/sec-moves-to-tokenize-tradfi-stocks-for-on-chain-trading-in-web3/
126 sats \ 4 comments \ @Cje95 30 Sep Politics_And_Law
This reminds me of the Mirror Protocol which was the first effort I saw try to tokenize stocks and while they started out okay they ended up getting crushed by the Biden Administration. I thought because of that this would take forever to happen and Congress would likely have to get involved. Thankfully it seems the Trump Admin is really following through on a lot of their crypto stuff like tokenization of stocks.
The SEC intends to allow tokenized RWAs, which would directly link stock values to traditional financial (TradFi) assets.
This shift will allow retail investors to bypass traditional brokerages and trade 24/7.
A shift to Web3-native exchanges could help bypass traditional market intermediaries, such as brokerages. Investors could freely trade stock tokens on the blockchain, 24/7. However, the SEC has not disclosed whether this will initially apply to a few stocks or be more widespread.
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10 sats \ 2 replies \ @grayruby 30 Sep
I don't really see the point of this in the US. It makes sense for people without access to US equities. 2B in smart contract hacks last year. You are increasing your risk drastically just to get 24/7 trading.
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20 sats \ 1 reply \ @Cje95 OP 30 Sep
It adds a really interesting dynamic to US markets. Imagine being able to trade while something is going on in Russia or the Middle East that will shake the markets. Some people would be able to get in or out of companies and others will be left holding the bag.
It said this would be to get around brokerages but I think that at least initally you are going to see it be brokerages that offer this. Robinhood is working on its own chain and big banks like Chase and others are operating private blockchains as well.
I like the idea of being able to trade 24/7 because some days I have missed out big time due to work but this would fix that to an extent. However, its a double edged blade and like you pointed out I dont see ETH or BTC being able to deal with not only the volume but the security needed to pull this off on a large scale.
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0 sats \ 0 replies \ @grayruby 30 Sep
That will be a market making nightmare scenario because tokenized assets likely take a decade to reach liquidity levels to handle a major event like that. Silicon Valley bank 2.0 incoming.
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0 sats \ 0 replies \ @StackerSports 30 Sep
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