Global Exchanges Warn Tokenised Stocks Could Threaten Market Trust

TheCryptoTimesPublicado em 2025-08-25Última atualização em 2025-08-25

Global stock markets face new pressure as the World Federation of Exchanges (WFE) warns regulators to act fast against tokenised stocks. The UK-based group, representing the world’s largest exchanges, raised alarms in a letter to the SEC, ESMA, and IOSCO.

The issue comes as major crypto platforms push deeper into tokenised equity products. Robinhood recently launched tokenised stocks in Europe, while Coinbase is seeking U.S. approval.

Proponents claim that these tokens facilitate 24/7 trading, reduce costs, and expedite settlement. However, the WFE believes such benefits come with serious risks. Besides, the group fears reputational damage for issuers if the tokens fail.

Concerns Over Market Integrity

The WFE stressed that these products mislead investors by being marketed as “equivalent to stocks” when they are not. “We are alarmed at the plethora of brokers and crypto-trading platforms offering or intending to offer so-called tokenised U.S. stocks,” the letter stated.

Consequently, the WFE wants regulators to clarify ownership rights, custody responsibilities, and enforce securities rules.

WFE CEO Nandini Sukumar explained the industry’s stance, noting that share issuers themselves have raised red flags. Moreover, some companies expressed concern to their exchanges about the reputational risks of tokenised versions of their stock.

Hence, the group believes investor protection must be prioritized before the market expands further.

Regulatory Pushback Builds

Regulators have already issued warnings. According to a recent statement by SEC Commissioner Hester Peirce, tokenized securities are subject to securities regulations. The SEC’s Crypto Task Force has also been keeping an eye on these offerings.

After Robinhood incorporated tokens attached to its shares into the European launch, OpenAI parted ways with them. Besides, regulators in the US and Europe are now having to face increasing demands to find a balance between safety and innovation.

Lowering the costs and making fractional investing easier can make tokenized stocks the next evolution in trading. But with unregulated trading, investors stand to be cheated, if not outright confused.

Tokenised equities promise innovation, but regulators now face the urgent task of ensuring investor protection and market integrity.

Also Read: LayerZero Secures Stargate in $110M Deal After Intense Bidding War

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