Written by: @Decentralisedco
Compiled by: AididiaoJP, Foresight News
Stocks on-chain: who makes the money?
In 2017–2018, Ethereum proved that smart contracts could run, and for a while we wanted to put everything on-chain. But over the following months, weak infrastructure taught the market a harsh lesson. Later the dream changed: what if crypto assets could be bought, sold, and held in the same brokerage account as traditional assets? That is how crypto ETFs came about. Now we are once again at a similar crossroads: putting every kind of financial asset on-chain so it is more usable and more accessible than it is today.
Today, traders and investors hold more than $6 billion in on-chain stock exposure through two paths.
The first is tokenization. A company buys shares, hands them to a custodian, and issues a corresponding token. All on-chain stock tokens together are worth $3.21 billion, up 10% in 30 days. The second is the synthetic path: using perpetual contracts to pay out stock price changes, but no one actually buys the stock. On trade[XYZ] alone, open interest in stock, index, and ETF perpetuals is $3.01 billion, equivalent to 94% of the total value of all on-chain stock tokens.
So, starting from the $3 billion scale, where does it go next? Our view is that stocks on-chain go through four stages.
Today, most of what you buy is just a wrapper: an offshore claim issued by some entity. Next, tokens become collateral, letting you borrow against Nvidia even when the market is closed. After that, brokers let you turn stocks you already hold into tokens without selling. The trillion-dollar market is here—foreign investors alone hold nearly $20 trillion in US stocks. Finally, companies record their shares themselves on-chain, and wrappers are no longer needed. A small group of listed companies is already doing this.
What you get is just an IOU
When you buy Nvidia through a broker, the name on Nvidia's shareholder register is Cede & Co, the nominee of the Depository Trust Company (DTC); your broker's ledger then shows you as the holder. Most stock tokens are essentially claims on that record.
Take Robinhood. BBVI, which is Bitstamp Global (owned by Robinhood), buys the stock, and Alpaca holds it as broker and custodian. Robinhood Assets (Jersey) then issues you a debt security. The practical meaning is: one token is one debt worth one share. Dividend reinvestment and stock splits adjust how many shares each token represents. It has no voting rights and does not give you stock ownership. If the issuer fails, the securities agent sells the stock and pays the holders.
Who is responsible for keeping the token price pegged to the stock price? Whoever is allowed to mint. Minters arbitrage between the stock and the token: buy whichever is cheaper, convert it into the other side, and sell, pulling the price back to par. At Robinhood, only BBVI can do this, and only from 2 a.m. Monday to 2 a.m. Saturday Central European Time. At other times no one can mint, so the token price depends on what other holders are willing to sell for.
Different issuers differ on who can mint, where it can be sold, and what you can do after holding it. They all buy shares through Alpaca. Binance, Robinhood, and Coinbase own their own exchanges, so they sell tokens to their own customers. xStocks is the exception. Kraken agreed in December to acquire it, but you can also buy tokenized stocks issued by xStocks on OKX, Bybit, and Gate. Today, if you want to borrow against stock tokens, the version you are most likely to get is the xStock version, because most lending markets support it.
Your broker, still the same old face
The top 100 tokenized stocks increased by $950 million over 90 days, from $2.09 billion to $3.03 billion. Over the same period, holding addresses rose from 417,000 to 4.21 million, a tenfold increase.
Over the past three months, two exchanges, Binance and Robinhood, brought in 86% of new holders. BNB Chain added 1.72 million addresses, and Robinhood Chain added 1.55 million. BNB Chain also brought in $517 million in value, more than all other chains combined. Given its huge non-US customer base, this is not surprising. But whether it can sustain this pace depends on whether people can find use cases. Solana and Ethereum together added 518,000 holders. Clearly, holder counts are being driven by applications that control most of the value chain and have massive ready-made distribution capabilities.
Of course, 4 million holders does not equal 4 million investors. Look at the holding structure of stock tokens across four chains: among 2.5 million addresses, 97.5% hold less than $100; only about 18,000 wallets hold more than $1,000.
Who holds the money? xStocks' minting wallet holds $1.13 billion in unsold tokens on Solana and $552 million on Ethereum. Of the $2.6 billion held outside these two wallets, exchanges account for 40%. On BNB Chain, Binance's own wallet holds 81% of all bStocks, so most bStocks never leave the exchange. Wallets worth more than $100,000 account for another 40%; on Ethereum, such wallets account for 80%, half of which are in 32 Safe multisig wallets, most likely belonging to trading firms. Contracts account for 14%, including trading pools and lending markets. Wallets below $100,000 account for only 7%.
So stage one is essentially "a brokerage account plus a blockchain receipt." If the exchange holds the token for you, it is no more useful than the stock in your brokerage account.
Stocks start working a second job
Why put stocks on-chain? Two reasons: buying, selling, and holding are cheaper; and you can do other things with them.
Buying $1,000 of Nvidia xStock through the Jupiter router and immediately selling it loses about 20 cents in spread and pool fees. The Jupiter app adds another 0.1% on each side, for a total of about $2.20. At the $100,000 scale, the router round-trip cost is about 0.6%. Off-chain, the most expensive step for overseas buyers is getting money to a US broker. The Indian app INDmoney quotes currency conversion at 0.5%–1.2%, with other fees afterward. Revolut's standard plan charges up to 1% on amounts above 1,000 euros per month. Conversely, if you already hold stablecoins, you do not pay these fees.
But more interesting is that the composability of on-chain stocks makes financialization easier and credit cheaper and more accessible. Kamino accepts xStocks as collateral, lends USDC at 5.75%, and lets you borrow up to 73% of the value of S&P 500 tokens. Jupiter Lend is 4.88%. Ether.fi can borrow through Aave at about 4%, with stock tokens included in the collateral mix, and you can spend the loan with its card. For US customers borrowing less than $25,000, Schwab charges 12.075%, and Interactive Brokers charges 5.38%. And if you are exactly the foreign retail investor these tokens are aimed at, you usually cannot borrow at all. On-chain infrastructure is opening new doors for people who can barely touch US stocks.
How big can this get? There are two reference points.
One is Wrapped Bitcoin, WBTC. In 2019, no mainstream lending market accepted WBTC as collateral, and supply was less than 600 BTC. In January 2020 Aave listed WBTC, in May Maker opened a WBTC vault, and in July Compound accepted it as collateral. By the end of 2021, supply reached 258,000 BTC, 415 times the level in January 2020.Second, stablecoins. In January 2020, the total value of stablecoins was about $5 billion, similar to stock tokens today. By May 2021, they had surpassed $100 billion, because they had become the underlying asset for borrowing, lending, and trading in every DeFi application. Lending markets and exchanges adopted them first, and supply then exploded. Stock tokens are at the starting point of this path. Kamino and Jupiter Lend hold $37 million in xStock collateral, corresponding to $9.7 million in borrowings, accounting for only 6% of stock tokens outside Solana minted wallets.
Stablecoins have also found work beyond trading: payments, remittances, and agentic finance all want to use them because of cheap transfers and near-instant settlement. What are the corresponding use cases for stock tokens?
The first is access. If you live in Lagos or Jakarta, you cannot open a U.S. brokerage account, but you can use USDT in your wallet to buy $50 of Nvidia. This is "a dollar deposit version of stocks," and it also matches holding data: 97% of positions are under $100. The second is spending. Ether.fi's card already lets you spend loans borrowed against stock tokens. The third is credit, and this is where the money is.
But credit has a ceiling. Kamino lends up to 73% against S&P 500 tokens, 55% against Nvidia and Tesla, 40% against Apple, and 30% against Strategy, Circle, and Robinhood. Borrowers are still far from hitting the limits, but the limits determine how far this stage can go. Lenders must be able to sell your collateral at any time, including on Sunday—when the stock market is closed and token trading is thin. This is where stock tokens get a bit tricky.
Wall Street is closed on weekends, on-chain stocks are not
Unlike ordinary stocks, on-chain stock tokens also trade on weekends, and on Sunday the deepest, most active market is perpetual futures. If perpetuals can track where stocks will open on Monday, lenders will dare to let you borrow more; if they deviate badly, lenders can only lower limits. As a result, weekend prices may determine how much you can borrow against stock tokens.
How accurate is it really? We took 19 stocks and indices, covering 30 weekends since March, and compared the change in trade[XYZ] perpetuals from Friday's close to 8 p.m. New York time on Sunday with the stock's Monday opening gap.
When the gap exceeds 1%, perpetuals are correct on direction 69% of the time. But by Sunday night, they have priced in only about a quarter of the magnitude, with a median of 26%. By 9 a.m. Monday, after overnight and premarket trading, the priced-in proportion rises to 91%. On Monday, June 15, Strategy opened up 7.5%, while perpetuals had already risen 6.4% by Sunday night. On Monday, September 21, Circle opened up 6.9%, while perpetuals had moved only 0.1%.
So perpetuals are a useful directional signal, but a bad weekend price. A correct, continuous price feed is the constraint here. The better perpetuals are at setting weekend prices, the more stock tokens can serve as collateral; the more collateral needs hedging, the greater perpetual trading volume will be.
Bring your stocks on-chain
At the end of June 2025, foreign investors held $19.86 trillion in U.S. stocks, accounting for 18.3% of the total value of U.S. stocks. Stock tokens currently equal only 0.016% of foreign holdings. $500 billion is 2.5%, and $1 trillion is 5%.
Crypto capital alone cannot get there. If one-tenth of all stablecoins were shifted into stock tokens, that would add only about $31 billion, and gaps would create somewhat more. The rest of the growth must come from stocks already held in brokerage accounts.
This will happen only when established companies find tokenized stocks profitable. Once one company makes money, the floodgates will open.
In 2021, Franklin Templeton put a U.S. government money fund on-chain, becoming the first U.S.-registered fund to record share ownership on a public blockchain. For the next three years, it was largely alone. In March 2024, BlackRock launched BUIDL, when tokenized Treasuries had only 17 products and $1.1 billion. Then WisdomTree, Fidelity, Invesco, and JPMorgan followed, and today tokenized Treasuries have 109 products and $15 billion. Franklin proved the pipes worked, and BlackRock's entry got everyone moving.
On the stock side, who moves first? Look at Robinhood. It is the only large traditional brokerage already issuing stock tokens, now covering more than 120 countries. In September, its token trading volume was $6.6 billion, accounting for 42% of all on-chain stock token volume. Robinhood Chain generated more than $30 million in fees in September. Fees are indeed falling, but at least we know how large the possibility is.
The one with the most conversion potential is Interactive Brokers. It has 5.19 million accounts and $930 billion in client equity, with most accounts outside the United States at the end of 2024. If clients converted 5% of that into tokens, the market would expand by about 15 times.
Its CEO said in July 2025 that stock tokens "look like a great opportunity to do much worse than buying ordinary shares." The reason is that stock token prices are poor, and thin liquidity naturally makes poor prices unavoidable. Its clients can already trade 24/5, with a borrowing rate of 5.38%, so a year ago there was indeed no incentive to offer tokens. But things are changing. The company's overnight trading volume rose from 3.8 million a year earlier to 10.9 million in the second quarter. Clients clearly want more trading hours, and tokens are one of the easier ways to provide that.
Stablecoins have already shown that waiting is too costly. Circle launched USDC in September 2018, when stablecoins were only a few billion dollars, and today it accounts for 24% of supply. PayPal launched PYUSD in August 2023, when supply was $124 billion, and today it accounts for only 0.9%. In October 2024, Stripe paid $1.1 billion to buy Bridge rather than build the infrastructure itself. When traditional players see evidence that tokenized stocks have found product-market fit, they will not be able to sit still.
Crypto exchanges have already recognized the potential. Binance, Robinhood, Kraken, Coinbase, OKX, Bybit, and Bitget are all selling stock tokens. We believe Robinhood is to tokenized stocks what Circle was to stablecoins in 2018.
Real shares, finally on-chain
By the fourth stage, the mask comes off. The company's transfer agent records the shares themselves on-chain, with no offshore issuer, no separate custodian, and no claim on someone else's account. The token is the share.
What does this bring? You get the rights attached to the shares, including voting and dividends. There is no arbitrage gap between the token and the share, because they are the same thing. As long as the transfer agent approves two wallets, the shares can move at any time and settle in seconds. The company can also see who really holds them, rather than a line reading "Cede & Co."
Has anyone done it? Yes, a small group. Galaxy and Forward Industries record shares on Solana through Superstate. Superstate is the transfer agent and updates the register as tokens move; Exodus also connects to Solana through it. Securitize is also a transfer agent and has already done this for Currenc Group and itself: its stock has been a token on Avalanche and Solana since it listed on the NYSE on July 2; on October 8, fewer than 100 wallets held $329 million in SECZ. Figure issues shares on its own chain.
Native shares are already useful on-chain. Forward Industries' shares are the largest single-stock collateral on Kamino, at $23 million, more than the total of all ten xStocks in Kamino's xStocks market.The onshore market is moving too. DTC's tokenization service was originally set to fully launch in October; Nasdaq plans to launch equity tokens in the second quarter of 2027; the SEC's September exemption allows U.S. venues to trade tokenized stocks in a permissioned pool, capped at 0.25%–2.5% of a stock's daily volume. But none of this yet lets you put shares into an open lending market. Once someone does, the offshore wrapper loses its main reason to exist, and so does the custody layer Alpaca rents to every issuer.
All the money flows to the front-end apps
Before an onchain stock reaches a user, there can be as many as ten companies in between.
Of the companies listed in the chart, every one except Backpack puts its stocks with Alpaca. Alpaca is a U.S. broker that sells brokerage plumbing to apps via API: it executes trades, clears them, and holds the stocks itself. Backpack uses RQD Clearing, another U.S. clearing firm, which provides similar services through intermediary broker Atomic Vaults Securities.
Financial companies make money either by guarding customer assets or by helping assets move. Launchpad has become a stock distribution mechanism, making money on trading fees. On Robinhood Chain, Pons and Long let anyone issue memecoins denominated in stock tokens, so every time you buy a memecoin, you're also buying a stock token. StonkFun does the same thing on Solana with xStocks, and pump.fun joined stock-token pairs in early September.
Launchpad charges on every trade. Pons earned $23 million in September, and StonkFun earned $27 million. They can also pump the stock tokens themselves. In early September, a memecoin pool held 53% of all tokenized HIMS on Robinhood Chain, and about $39,000 of buying pushed the token to $132.64 while the New York close was only $28.84, until BBVI minted more tokens. Pons's daily fees have since fallen about 90% from their peak.
Now look at the issuers. They barely make money. Robinhood mints for free and charges 0.05% to redeem after the first 90 days. xStocks sets its main fees at zero, Binance converts for free, and Ondo charges no mint or burn fee, instead earning the spread between quote and execution price. Stablecoin issuers can earn interest on the Treasuries behind them, and in September issuers earned a total of $740.7 million. Stock-token issuers hold stocks, but the dividends go to you. It's like a stablecoin issuer, but with no interest income, so every major issuer is attached to an exchange or app.
Backpack shows how unprofitable issuance is. It launched Backpack Securities in June, issuing its first token on the day SpaceX listed. Its tokens traded $1.12 billion on Solana DEXs in June and $1.04 billion in July. For a while, it handled most of the tokenized SpaceX and Micron trading on Solana DEXs. But those trades happened on DEXs it doesn't own. On its own exchange, it does about $1 million a month in spot stock trading, and $165 million in stock and index perpetuals in September. At standard rates, those perpetuals earn at most about $120,000. Backpack doesn't disclose revenue. Its token is worth about $30 million, roughly 1% of all stock tokens, and in September it accounted for no more than 5% of onchain stock-token volume. Winning trading in a few names didn't win the assets or the fees.
The money is in the apps.
The Kraken app charges a 1% spread on xStocks, while Kraken Pro charges 0.08% on the same token. Robinhood Wallet charges 0.8% on swaps, plus 0.05% to the router. Issuers get nothing on any route. The same exchange earns $10 or 80 cents depending on which app you open. Advanced users bring much larger volume, so the rates are much lower. Apps give up the fee difference to own high-value customers.
Ondo shows the other side: it "rents" customers from partners. This summer, Bitget paid customers to swap Ondo tokens for its own. Bitget says it handled 89% of Ondo tokenized stock volume in December 2025.
Nineteen Nvidia stock tokens
The second place money is made is the default token for each stock. Nvidia exists as 19 contracts, 8 issuers, and 11 chains. Lending markets and perpetual venues accept only a few, and liquidity concentrates around the accepted standard.
Lenders hold 40% of the xStocks Nvidia token on Solana, 10% of the Robinhood version, and less than 1% of the Binance version. On Solana, xStocks is accepted collateral at Kamino, Jupiter Lend, and Bybit, and it controls DEX liquidity. Stablecoins integrated the same way, and USDT and USDC now account for 82% of supply. Eventually, we expect two or three tokens per stock. For now, xStocks is best positioned to be the USDC of stock tokens.
Everyone wants to be a broker until no one needs a broker
The least advantaged positions are the chain and the custodian.
Chains have already been commoditized. In the 30 days through October 5, Robinhood Chain's gas fees fell 98%, but stock-token balances didn't change. Will chains become broker equivalents, earning a few basis points per trade? We don't think so.
Custodians don't appear to make money at all. None of Alpaca's customers disclose paying custody fees. It makes money on order flow and stock lending, then shares some of it downstream. Binance gets half of Alpaca's revenue from customer order flow and 65% of stock-lending profits. Its weakness is that it's easily replaceable, and customers are starting to own their own brokers. Binance has Nest Trading but still routes orders to Alpaca; Ondo bought broker Oasis Pro. Transfer agents can fully replace custodians.
If you want to bet, first ask who makes money and what you own
If you want to participate in this trend, the most direct starting point is to see who makes money when you use stock tokens. Robinhood and Binance already own the customers. xStocks is getting its tokens accepted by lenders and competing exchanges. Hyperliquid is trying to tell you what a stock is worth while Bloomberg terminals are closed.
But every advantage has conditions. You may be able to borrow against Nvidia at any time, but once a loan is liquidated, someone has to buy it. Your token is only as good as the claim behind it. We also know issuers can fail. Traditional brokers may eventually offer the same benefits, without the offshore wrapper.
Even if you pick the right business, you still have to ask: what do you actually own? Does the asset you buy give you a share of success? Owning a token tied to a growing business doesn't automatically give you a share of revenue. Putting billions of dollars of stocks onchain doesn't guarantee much gas revenue either.
Next we have to watch how investor behavior changes. Will they borrow against it? Will they trade onchain more often? You can already buy a token that tracks Nvidia's price. But the real big money waits until someone gives it enough uses.