The meeting came as global regulators and traditional exchange associations had urged the SEC to crack down on tokenized stocks. A meeting was held on Monday between crypto exchange Kraken and the U.S. Securities and Exchange Commission’s Crypto Task Force to discuss the tokenization of traditional assets and a tokenized trading system.
A memorandum filed on Monday noted that SEC staff met with four representatives of Payward, Inc., Kraken Securities LLC, and two from the law firm Wilmer Cutler Pickering Hales and Dorr LLP.
The agenda was to discuss the tokenized trading system, the regulatory framework and legal requirements for operating the system, and the potential benefits of tokenization.
Kraken’s SEC meeting came at a time when traditional exchange industry associations and global regulators had urged the SEC to take a stricter regulatory approach toward tokenized stocks.
It has been argued by the associations that a lack of investor protection safeguards exists, which are present in the traditional markets.
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Tokenized stocks are typically not bound by the restrictions of traditional markets and can be traded 24/7. Kraken and Robinhood are the two most prominent platforms to offer these services.
Kraken announced its tokenized stocks service on May 22, which enables non-US investors to buy US equities around the clock.
Tokenized stocks of US equities were started to be offered by Robinhood to users in the European Union on June 30.
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Kraken Expands Tokenized Stock Offering to Tron Blockchain
It was announced by Kraken on Wednesday that its tokenized stock product offering had been expanded to the Tron blockchain.
The growth stage of tokenized stocks is currently in a nascent stage.
According to RWA.xyz, the total value of all tokenized stocks in circulation currently stands at $360 million, a figure that is down 11% in the past 30 days.
This represents a mere 1.35% of all Real World Assets (RWAs) that have been tokenized, as nearly $26.5 billion worth of RWAs are currently on-chain.
According to Binance research, tokenized stocks represent a trillion-dollar opportunity. If 1% of the entire global equities market is tokenized, that could propel the sector to surpass the $1.3 trillion mark in market capitalization.
A Kraken survey released last week revealed that 65% of the 1,000 U.S. investors who invest in both equities and crypto expect crypto to outperform equities over the next decade.
