Coinbase CEO Brian Armstrong has declared that the tokenization of S&P 500 stocks will break Wall Street’s monopoly on equity trading, as the traditional financial system faces its most significant structural challenge in decades.
Speaking about the rapid growth of tokenized assets, Armstrong argued that blockchain-based securities will democratize access to US equities, allowing investors worldwide to trade fractional shares of S&P 500 companies without the gatekeeping imposed by traditional brokerages and clearing houses.
The S&P 500 has been hitting record highs in recent weeks, driven by AI optimism and resilient corporate earnings. However, Armstrong contends that the benefits of this market rally are unevenly distributed, with retail investors facing barriers that institutional investors do not. Tokenized stocks, he argued, eliminate these barriers by enabling 24/7 trading, fractional ownership, and global access.
The tokenized securities market has grown to over $2.3 billion in total value, driven by increasing institutional involvement. Major financial infrastructure providers such as the DTCC have begun experimenting with blockchain-based settlement and trading systems, signaling that the traditional financial establishment is taking tokenization seriously.
Coinbase has positioned itself at the center of this trend, offering custody and trading services for tokenized assets. The company’s Base layer-2 network has also become a platform for issuing tokenized securities, including tokenized US Treasury products and corporate bonds.
Critics note that tokenization still faces regulatory hurdles in most major markets, and that widespread adoption will require significant changes to securities laws and market structure.
This article was adapted from U.Today. Read the original here.
