After Trump returned to power, the US regulatory environment has undergone major changes, and the tokenization of securities has ushered in a policy dividend window. Platforms such as Robinhood, Bybit, and Kraken have joined the game, setting off a wave of Tokenized Stocks and trying to reconstruct the logic of global asset trading in an on-chain way. Behind this revolution of capital and encryption, there is not only the ambition to subvert the traditional brokerage model, but also a deep consideration of compliance games and product paths.
Three mainstream models of US stock tokenization
Attempts to tokenize U.S. stocks in the current market can be roughly divided into three paths: the third-party compliance issuance + multi-platform access model represented by Backed Finance; the licensed brokerage self-operated closed-loop model represented by Robinhood; and the contract for difference (CFD) model adopted by platforms such as Bybit. These three paths are not only different in technical architecture, but also represent different understandings of compliance responsibilities, user relationships and market structure.
Third-party compliant issuance + multi-platform access model
The core of this model is separation of compliance issuance and platform access, mainly in the alliance formed by xStocks, Kraken and Bybit in recent days. The specific operation path is that institutions such as Backed Finance, which hold Swiss or EU regulatory licenses, use the IBKR Prime channel to purchase stocks in the US stock market and hold them in custody under regulated custodians such as Clearstream and Interactive Brokers.
After the stocks are actually purchased and credited, the corresponding stock tokens (such as TSLAx, AAPLx, NVDAx) will be minted at a 1:1 ratio on public chains such as Solana (which will be expanded to Ethereum ERC 20 in the future), and crypto trading platforms such as Kraken, Bybit, and Jupiter will provide liquidity support and secondary transaction matching services within the trading platform and on the chain.
The most significant feature of this model is that the issuer is the primary responsible party. All compliance requirements, transparent disclosure of assets, and actual off-chain custody are undertaken by institutions such as Backed. The trading platform only serves as a front-end access party and does not need to bear the compliance pressure of issuing security tokens, thus achieving large-scale compliant circulation in non-US markets.
The advantage of this path is that the logic of asset confirmation is clear, all tokens correspond to actual holdings 100%, and are managed by the custodian in separate accounts. It is open and liquid, supports on-chain transactions, 24/7 all-weather transactions, and can seamlessly connect with DeFi applications, and can seamlessly connect with the later extended coin-share DeFi protocol. In addition, the compliance path is clear, only the issuing end needs to have a regulatory license, and the platform end can theoretically expand its business indefinitely as a distributor and can quickly expand the non-US region market.
In fact, as early as around 2020, FTX tried to tokenize stocks using this path. At that time, FTX allowed users to trade tokens of well-known US stock companies such as Tesla (TSLA) and Apple (AAPL) on its platform. These tokens were issued by its Swiss subsidiary Canco GmbH and linked to real stocks held by third-party brokers, achieving a 1:1 anchoring mapping relationship.
At that time, users could invest in popular U.S. stocks 24/7 with a minimum of about $1. In order to further comply, FTX cooperated with German financial services institutions CM-Equity AG and Digital Assets AG to jointly create a compliance framework to make these U.S. stock tokens legal and financially compatible. However, as FTX declared bankruptcy due to serious problems such as misappropriation of funds and fraud allegations, its tokenized stock business was also terminated in November 2022.
This path also has obvious limitations. Although the SEC is not as strict as it was during the FTX period, the SEC has not yet recognized the compliance of such products at this stage. Products following this path are limited to US users. And because the path is easier to copy, if the major trading platforms cannot reach a consensus, there will be multiple tokenized stocks of the same company, and liquidity will be relatively fragmented.
The most important thing is that you still need to trust the issuer. Although the custody system is independent, the issuer has a gap period in data disclosure and asset redemption (data falsification or redemption delay). Take Backed, the issuer behind xStocks, as an example. Some questioning voices have appeared in the community. KOL CryptobraveHQ expressed concerns about the background of Backeds team members on X. Backeds three main co-founders Adam Levi, Yehonatan Goldman, and Roberto Klein are the co-founders and former CTO, COO, and head of legal and regulatory affairs of the zeroing project DAOstack. Cryptobrave further stated that after its token $GEN ICO raised about 30 million US dollars, the team was too lazy to even go to a small firm and just let the token go to zero after issuing it.
Licensed securities firms’ proprietary issuance + closed-loop on-chain transactions
Currently, the only project with the most complete planning of this path is Robinhood, which takes a more thorough broker-driven on-chain model. Compared with the xStocks model, it does not rely on third-party compliant issuers, but takes the traditional brokerage license as the basis, opening up the entire chain of stock procurement, token minting, user transactions and settlement.
Specifically, Robinhoods European subsidiary holds a Lithuanian securities license and can legally purchase and custody U.S. stocks, ETFs, private equity and other targets. Tokens (such as TSLA-t, APL-t) are then minted on Arbitrum and closed for trading in its own app. The on-chain status is updated synchronously for each token transaction, and the back-end inventory dynamically maps the actual shareholding situation to ensure that the total amount on the chain = the custodial position. Robinhood also plans to migrate this system to its self-developed Robinhood Chain to achieve complete on-chain autonomy and cross-chain transfer capabilities.
This model is more difficult to replicate because Robinhood itself, as a regulated entity, has full-chain capabilities such as securities issuance, clearing, and dividend execution. Therefore, whether it is off-chain stock purchases, on-chain coinage, or transaction settlement and capital flow, it can be fully closed-loop controlled without relying on third-party custody or matching. At the same time, the business line is also wider. Although only the stock tokenization of OpenAI and SpaceX has been announced, Robinhood has institutional foundations and technical systems for real assets from stocks to private equity, bonds, RWA, etc.
CFD Model
The CFD path does not touch the stock assets themselves, but uses the stock price as the index source, and realizes price game through the platforms own contract. For example, the TSLAUSDT perpetual contract provided by Bybit does not hold any Tesla stock in its underlying assets. It only provides users with high-leverage, two-way tradable contract products based on the oracle price source and market-making logic.
The advantages of CFD are also obvious. It is easy to deploy and quickly go online. You can go online with any US stock-related target without actually purchasing stocks or having a custody link. After the launch of Bybit TradFi, users can trade most traditional financial assets on the Bybit App, such as oil, gold, stock CFDs and foreign exchange, with a total of more than 100 assets, and support high-frequency trading, leveraged operations and other modes. However, because it is not an actual securities issuance, the platform only operates according to derivatives regulatory standards.
The problem with this path is also obvious. CFD is not a true path in the sense of tokenized securities. It is more like a speculative response of crypto platforms to the demand for US stocks. Users do not actually hold these assets, and the centralization risk is obvious. The asset structure is even riskier than Memecoin on the chain.
Two sides on the same path, who will win between Robinhood and Coinbase?
As the tokenization trend of U.S. stocks heats up, Coinbase and Robinhood, two financial technology companies born in San Francisco, have embarked on two very different paths. One started from on-chain infrastructure and tried to use technology and law to penetrate U.S. regulatory barriers, while the other started as a brokerage firm and was the first to implement a closed-loop scenario in Europe, gradually building a global tokenized trading network.
How did Robinhood take the lead in implementing the “on-chain brokerage” model?
As global exchanges compete to explore tokenized stocks, Robinhood is no longer satisfied with the label of zero commission revolutionary, but is trying to reshape the entire infrastructure of traditional asset trading. From stock tokenization trading launched in Europe to building Robinhood Chain for global developers, the US brokerage giant is advancing a deeper transformation at an unprecedented pace, allowing stocks, private equity, and even financial derivatives to fully enter the on-chain world.
Robinhoods on-chain strategy is far from being as simple as mapping real stocks to tokens, but rather a deep reconstruction around compliance licenses, on-chain clearing, and multi-market collaboration. This also makes it fundamentally different from other crypto platforms that only provide token trading. Robinhood is the only on-chain brokerage that connects brokerage + Layer 2 + real stock custody.
Starting from Europe, creating the first compliance test field for tokenized assets
In early June 2025, Robinhood completed the acquisition of Luxembourg cryptocurrency trading platform Bitstamp for $200 million in cash. This move added more than 50 licenses and registrations to its cryptocurrency division, as well as a mature institutional exchange with more than 5,000 institutional clients. At the same time, in May, Robinhood announced that it would acquire Canadian cryptocurrency platform WonderFi for approximately $179 million to strengthen its business in the Canadian market. Robinhood has thus received an important piece of the puzzle in its U.S. stock tokenization plan.
At the end of June, Robinhood announced the launch of an Arbitrum-based stock token trading platform in 31 European countries, with the first batch of more than 200 US stocks and ETFs, and plans to expand to equity tokens of unlisted companies such as SpaceX and OpenAI. These tokens are completely held and minted by Robinhood itself, ensuring a 1:1 correspondence with real stocks, and simultaneously supporting real-time dividends and stock splits.
Unlike previous attempts at centralized platforms, Robinhood did not rely on third-party issuers, but instead used its own MiFID securities license in Lithuania held by its European subsidiary to buy real stocks under a compliance framework and put them into a regulatory account, building its own custody-minting-trading closed-loop process. At the same time, Robinhood did not stop at upgrading the token trading interface, but simultaneously upgraded the original Robinhood Crypto App to a comprehensive investment platform, integrating perpetual contract trading, cryptocurrency management, on-chain staking, and AI investment assistants into one App, with a complete investment toolkit to support user migration.
Does it sound familiar? Phase 1 is issuing coins, Phase 2 is looking for liquidity, and Phase 3 is decentralized finance.
But the European business is just the first step for Robinhood, and the launch of Robinhood Chain is a comprehensive declaration of the future form of the Internet of Assets. This Layer 2 network built on Arbitrum in cooperation with Offchain Labs not only carries the transaction and settlement functions of all Robinhood tokenized assets, but will also be open to third-party developers around the world, forming an on-chain ecosystem around the issuance of real assets.
Its underlying design logic is divided into three stages: in the first stage, Robinhood brokers purchase real shares and mint on-chain tokens after custody; in the second stage, Bitstamp is introduced as a supplementary source of liquidity so that token trading can continue during weekends and other periods when traditional markets are closed; in the final stage, users can self-custody the token assets issued by Robinhood and migrate them to other chains or DeFi protocols for use.
Throughout the process, Robinhood controls the right to buy, custody, minting, trading portals and user relationships, thus achieving a closed loop on the chain of tokens ≈ stocks. The chain is only a bookkeeping layer, and all actions are synchronized off-chain. This model sacrifices the transferability of tokens, but greatly enhances regulatory controllability, and also paves the way for its subsequent expansion to Robinhood Chain, a global public chain that is compatible with traditional finance and blockchain assets.
Robinhoods logic is that since I am a broker, I will buy stocks, keep custody, and mint coins myself. Throughout the process, Robinhood controls the right to buy, custody, minting, trading entrance, and user relationship, thus realizing the closed loop of tokens ≈ stocks on the chain. The chain is only a bookkeeping layer, and all behaviors are synchronized off the chain. This model sacrifices the transferability of tokens, but greatly enhances regulatory controllability, and also paves the way for its subsequent expansion to Robinhood Chain, a global public chain that is compatible with traditional finance and blockchain assets.
This means that Robinhood is no longer a terminal trading platform, but is transforming into an on-chain brokerage base that integrates asset issuance, clearing and trading. Particularly noteworthy is Robinhoods layout of private equity. Its tokenized issuance not only breaks the high threshold structure of traditional private equity investment, but also may change the liquidity logic of early technology equity and form a new species of crypto primary market. The ICM that Solana has been calling for some time may be realized on this traditional brokerage side.
Coinbase: Starting from chain building, reversely seeking exchange + compliant issuance synergy
Although it has not yet launched its stock business, Coinbase, which recently listed Circle and brought its perpetual contract business back to the United States, cannot be ignored here. In fact, Coinbases logic is another set of paths, first build the infrastructure and then lobby for supervision, seek licenses, exemptions or precedents, and then tokenize assets.
According to Reuters , on June 17, Coinbases chief legal officer Paul Grewal said that relying on its own Base public chain and Layer 2 technology stack, as well as Dormants broker-dealer (a securities brokerage business entity that has not yet been activated), it has applied to the SEC for a no-action letter, hoping to obtain legal exemptions for tokenized stock products.
Coinbases plan is to issue tokens that represent equity on the chain once it is approved by the SEC, and cooperate with on-chain smart contracts to complete T+0 settlement, fractional share splits, real-time dividends and other processes. Its native underlying stablecoin assets, native Layer 2 Base, and top institutional exchanges will bring greater advantages on the sales side.
Compared to Robinhood’s “do first, then regulate” approach, Coinbase chose the “compliance first” approach. This not only reflects its sensitive identity as a US listed company, but also is a higher-risk strategy that can “take over the largest share of the US market” if it breaks through.
Technology vs. license, open source vs. closed loop: Who can win the last mile?
From the perspective of the underlying structure, Robinhood is a license-driven on-chain brokerage, while Coinbase is an infrastructure-driven on-chain platform. The former takes a closed-loop control path, while the latter seeks open collaboration.
Robinhood currently has the qualifications for the entire securities issuance chain, and has a stronger ability to connect fractional shares with real equity; and although Coinbase has not yet achieved actual issuance, the technical maturity of its Base public chain and the depth of matching on the exchange side give it the potential to become a global on-chain securities standard network.
This duel, in the final analysis, is still a multilateral collaborative game of who can convince users, regulators and the market at the same time. If Robinhood can open up on-chain liquidity + multi-platform linkage, and if Coinbase can get the green light from the SEC, it may directly become the traffic entrance for tokenized equity in the US. One started from the traditional industry and the other started from cryptocurrency. The competition for the future route of on-chain securities has just begun.
Although tokenized stocks have made great progress in technology, compliance and user experience, they still face several challenges in scale, including fragmented liquidity, high difficulty in hedging, complex dividend and governance chain, and different geopolitical supervision. However, judging from the trend, with the entry of giants with compliance qualifications such as Robinhood and Coinbase, tokenized stocks will move from gray experiments to legal entry, and the next stage of asset transformation may be coming soon.
