eToro to launch tokenized U.S. stocks on Ethereum

eToro has announced an expansion of its product offering with the launch of tokenized stocks of U.S.-listed companies on the Ethereum blockchain.

The trading and investing platform revealed this as part of its raft of new offerings, with the company planning to bring U.S.-listed equities to investors as tokenized stocks on the Ethereum (ETH) blockchain. 

In addition to 24/5 trading of 100 U.S.-listed stocks and exchange-traded funds, eToro also has its eyes on spot-quoted futures. According to the announcement, the aim of these expansions is to provide investors with the opportunity to benefit from accessible-sized contracts.

eToro is collaborating with CME Group on this venture, with the efforts set to enable spot-based pricing and longer-dated expiries.

eToro to tokenize U.S. stocks on Ethereum

eToro’s tokenization journey picks momentum with the announcement of the upcoming listing of ERC 20 tokens of stocks listed on major exchanges in the U.S. 

This continues a path that began with the launch of the platform in 2012 and gained further traction following the acquisition of Firmo, a Denmark-based tokenization startup, in 2019. Since then, eToro has unveiled tokenized gold, silver, and fiat currencies. The move to bring tokenized stocks to the Ethereum blockchain expands upon this growth.

eToro co-founder and chief executive officer Yoni Assia says asset tokenization has the potential to transform the decentralized finance ecosystem.

“We began our tokenization journey in 2019 and we’re excited to now be able to significantly progress that initiative,” Yoni said. “Our goal is to tokenize every asset on eToro – starting with stocks – enabling our users to move tokenized assets onto the blockchain and from there integrate them into the broader DeFi ecosystem. Users will then be able to redeem tokenized stocks for the underlying position on eToro and vice versa.”

Top crypto platforms also eye tokenized stocks trend

Democratization of global financial markets is a major benefit of tokenization, Assia added. It also introduces 24/7 accessibility, transparency, and increased user control.

While hurdles to adoption remain, including vested interests, Assia says regulatory milestones such as European Union’s MiCA and United States’ GENIUS Act, are key.

Several crypto platforms as well as traditional firms have tokenized stocks ambitions, including Kraken, Coinbase and Robinhood. Kraken launched tokenized stocks with 24/5 trading via the xStocks platform in June.