Binance Plans Return of Tokenized Equities After 2021 Pause
Binance plans to reintroduce tokenized equities on its platform, marking a return to stock-linked digital assets for the first time since 2021.
“Exploring the potential to offer tokenized equities is a natural next step” to connect traditional finance with crypto, a Binance spokesperson said in a statement to Cointelegraph on Friday. The spokesperson added that Binance aims to broaden user options while adhering to regulatory requirements, noting the exchange has supported tokenized real-world assets since last year and recently launched the first regulated TradFi perpetual contracts settled in stablecoin.
Binance introduced stock tokens in April 2021, starting with Tesla and later adding Coinbase and other technology and crypto-related firms, including MicroStrategy, Apple and Microsoft. The products drew scrutiny from German regulators, and in June 2021 the UK Financial Conduct Authority directed Binance to halt certain regulated activities. In July 2021, the exchange announced it would cease support for stock tokens.
In December, changes to Binance’s application programming interface suggested the exchange was preparing potential stock trading features, though the company did not confirm at the time. U.S.-based Coinbase is also reportedly evaluating the addition of tokenized stocks.
US market structure bill and tokenized equities
The US Senate Agriculture Committee and the Senate Banking Committee are considering legislation to establish a digital asset market structure. The Agriculture Committee is scheduled to hold a markup on its bill on Tuesday, while the Banking Committee’s markup has been postponed indefinitely after Coinbase withdrew its support.
In a Jan. 14 social media post explaining his opposition to the current draft, Coinbase CEO Brian Armstrong said the bill would amount to a “defacto ban on tokenized equities” if enacted as written. Banking associations, lawmakers and other groups have also raised concerns about provisions related to stablecoin rewards, conflicts of interest and decentralized finance.
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