Global stock exchanges are intensifying calls for regulators to take decisive action against the growing trade in tokenised stocks, warning that the unregulated market poses risks to investors and threatens the integrity of traditional equity markets.
Tokenised stocks are digital representations of publicly listed company shares that are issued and traded on blockchain platforms, often without oversight from securities regulators.
Exchanges argue that these products, while marketed as innovative, allow investors to gain exposure to blue-chip firms without the protections provided in regulated markets.
In many cases, the issuers of tokenised stocks do not actually hold the underlying shares, raising concerns about transparency, liquidity and investor protection. Some platforms have offered tokens linked to companies such as Tesla, Apple and Amazon, attracting retail investors seeking lower entry barriers and round-the-clock trading.
Traditional exchanges view this development as a direct challenge to their role as custodians of market trust and fairness. They warn that the continued growth of unregulated tokenised assets could undermine price discovery in official markets, distort trading activity and expose investors to significant fraud risks.
Several regulators, including those in Europe and the United States, have already cautioned against the use of tokenised securities and signaled possible enforcement actions, but exchanges are pressing for stricter measures.
The push comes at a time when blockchain and digital assets are reshaping the financial sector, forcing regulators to balance innovation with stability.
Advocates of tokenised stocks argue that they democratize access to investments, particularly for retail investors in regions with limited access to international markets. However, critics maintain that without clear rules and enforcement, the market remains prone to abuse and instability.
Analysts say the growing pressure from stock exchanges highlights the urgent need for a global regulatory framework that addresses digital assets more comprehensively. As tokenisation technology advances, regulators face mounting pressure to ensure innovation does not come at the expense of investor safety and market stability.
Written By Ian Maleve
