What are tokenised stocks?

Tokenised stocks are blockchain-based digital representations of traditional shares such as Apple or Tesla stock. They allow investors to trade equity exposure on blockchain networks rather than only through traditional exchanges and brokerages.

Why are regulators concerned about tokenised stocks?

Researchers and regulators worry tokenised stocks could fragment liquidity across multiple blockchain platforms instead of concentrating trading on major exchanges like the NYSE or Nasdaq. Fragmented markets can increase price inefficiencies and volatility.

What did the SEC recently change for tokenised equities?

The US Securities and Exchange Commission introduced an “innovation exemption” that may allow third-party platforms to list tokenised stocks without direct issuer approval. The full framework and restrictions are still being developed.

Why does liquidity fragmentation matter for investors?

Liquidity fragmentation means trading volume is spread across many separate venues instead of one deep market. This can increase slippage, widen spreads and create inconsistent pricing between platforms.

How could tokenised stocks affect traditional exchanges?

Traditional exchanges risk losing trading volume, transaction fees and market dominance if tokenised trading moves activity onto decentralised blockchain platforms. Analysts say this could weaken the revenue base of incumbent financial institutions.

Why are some analysts calling tokenised stocks a structural threat?

Tiger Research argued that breaking up centralised market liquidity threatens overall market efficiency and financial competitiveness. Analysts fear capital and revenues could increasingly shift offshore to decentralised networks.

What are the benefits of tokenised stocks for retail investors?

Supporters say tokenised stocks could provide faster settlement, lower transaction costs, fractional ownership and 24-hour trading access. Blockchain infrastructure may also make US equities more accessible to international investors.

What role does Hyperliquid play in tokenised assets?

Hyperliquid is a decentralised trading platform that has seen growing demand for blockchain-based real-world assets. Open interest tied to tokenised assets on the platform recently reportedly reached a record $2.6 billion.

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Tokenised stocks threaten liquidity and revenue fragmentation

Written by Liezl GambePublished May. 22 2026

The US Securities and Exchange Commission’s decision to allow third parties to list tokenised stocks could create major structural risks for traditional financial markets, according to Tiger Research.

Tiger Research director Ryan Yoon warned that tokenised equities may fragment liquidity as trading activity spreads across multiple blockchain networks and decentralised platforms rather than remaining concentrated on major exchanges such as the NYSE and Nasdaq.

Yoon said traditional finance views the breakup of centralised liquidity pools as a “serious structural threat” because fragmented trading activity can increase price discrepancies, slippage and broader market inefficiencies.

The concerns follow the SEC’s announcement this week that third-party platforms may qualify for an “innovation exemption” allowing tokenised stock listings without direct issuer approval, although the full framework remains under development.

Tiger Research also warned that tokenised stocks could fragment financial revenues as trading activity and associated fees increasingly move offshore and onto decentralised platforms instead of remaining within domestic exchange systems.

“Tokenised stocks trade across multiple platforms in disaggregated form, financial revenues that should accrue to domestic exchanges instead flow offshore,”

Said Yoon.

The warning comes as capital continues shifting into blockchain-based real-world assets, with open interest tied to tokenised assets on Hyperliquid reportedly reaching a record $2.6 billion this week.

Supporters of tokenised equities argue the model could still deliver major benefits including faster settlement, fractional ownership, lower transaction costs, 24-hour trading access and broader global participation in US equity markets.