Binance Eyes Return Of Tokenized Equities Five Years After First Launch

Binance is set to reintroduce tokenized equities to its platform, a product it last offered in 2021. This move marks the exchange’s renewed effort to bridge traditional finance with the crypto market, offering users exposure to publicly listed companies through blockchain-based instruments. After several years without these offerings, Binance appears focused on expanding its product lineup while keeping regulatory compliance in mind.

Expanding Investment Options Through Tokenization

A Binance spokesperson explained that tokenized equities are part of the company’s strategy to link conventional financial markets with digital assets, speaking to Cointelegraph about the initiative. The company is focused on expanding the range of investment options while ensuring compliance with regulatory standards.

Binance has already made strides in tokenizing real-world assets and recently launched regulated traditional finance perpetual contracts settled in stablecoins. A return of tokenized shares of publicly listed companies would mark a significant addition to its product suite, especially after the platform exited this space in mid-2021.

Regulatory Hurdles and the Rising Tokenized Asset Market

Binance first launched tokenized shares in April 2021, initially offering blockchain-based products linked to companies such as Tesla. The platform later expanded to other major technology firms. However, regulatory pushback soon emerged in Europe. German authorities questioned the structure of the tokenized products, and the UK regulator restricted Binance’s ability to operate regulated services locally. 

Despite these hurdles, interface updates in December hinted at a possible reintroduction of digital stock products, suggesting that Binance might be preparing to return to this market, though the company did not formally confirm the plans at the time.

Meanwhile, the market for tokenized assets has been growing steadily. According to Token Terminal, their total capitalization now stands at $324.3 billion. Excluding stablecoins, these assets account for $19.652 billion, with digital stocks making up $472.8 million. This growth shows that investor interest in blockchain-backed products is rising, with ARK Invest even projecting that the value of tokenized assets could reach $11 trillion by 2030.

Regulatory Uncertainty Surrounds Tokenized Equities

At the same time, U.S. lawmakers are considering frameworks to regulate digital assets, with the Senate’s Agriculture and Banking Committees reviewing proposals that could establish rules for the sector. The Agriculture Committee plans to hold a discussion on its draft bill on Tuesday, in contrast to the Banking Committee, which has paused its review following Coinbase’s withdrawal of support.

On January 14, Coinbase CEO Brian Armstrong spoke out on X against the proposed bill, warning that, as drafted, it could effectively ban tokenized equities and emphasizing that a poorly structured law would be worse than having no legislation at all.

The bill has also drawn criticism from banking groups and legislators concerned about stablecoin incentives, potential regulatory conflicts, and provisions affecting decentralized finance.