In a groundbreaking move, Coinbase has launched tokenized versions of U.S. stocks on its Base blockchain network. This innovative offering begins with shares from tech giants such as Apple, Nvidia, Meta, and Alphabet, targeting eligible investors outside the United States.
The newly introduced tokens are backed 1:1 by real shares held with regulated broker Alpaca, ensuring a secure investment structure. With this launch, Coinbase aims to expand the reach of U.S. stocks to a global audience, leveraging the advantages of blockchain technology.
Each token represents a direct claim on an underlying share, allowing investors to hold these digital assets in self-custody wallets and trade them without the restrictions of traditional stock market hours. This flexibility is a notable shift, enabling continuous trading and movement of assets between wallets without any whitelist requirements.
Coinbase has established its international tokenization hub in Abu Dhabi, where the tokens are issued under the Abu Dhabi Global Market regulation. The company utilizes its B20 framework to mint these tokens natively on Base, ensuring that dividends and stock splits are automatically reflected in the token’s value.
Token Functionality and DeFi Integration
Investors can utilize tokenized stocks in various decentralized finance (DeFi) applications. For instance, users can supply tokenized Nvidia shares as collateral for loans on platforms like Aave, or trade tokenized Apple shares on decentralized exchanges such as Aerodrome.
To enhance functionality, Coinbase has partnered with Chainlink to provide continuous price data for the tokenized stocks. This integration allows DeFi protocols to incorporate these assets into lending markets, exchanges, and structured products. Chainlink’s feeds derive the token values from underlying stock prices, adjusted by a multiplier that accounts for dividends and corporate actions.
Market Growth and Future Prospects
Coinbase’s entry into the tokenized stock market is part of a broader trend, as rival exchanges like Kraken and Binance are also exploring on-chain stock trading options. Currently, the total value of tokenized stocks across the market has reached approximately $2.48 billion, reflecting a 5.2% increase over the past 30 days. Monthly transfer volume has surged to $27.28 billion, with the number of holders surpassing 2.1 million.
The tokenization market is not limited to stocks; banks and asset managers are actively moving significant amounts of U.S. Treasuries and private credit onto blockchain platforms. A report from Citi has projected that the tokenized securities market could skyrocket to $5.5 trillion by 2030, indicating a promising future for this innovative financial landscape.
As Coinbase continues to expand its offerings, it signals a new era for global investors seeking access to U.S. stocks through the power of blockchain technology.
