Tokenization has long been seen as a path toward more inclusive finance. By putting real-world assets—such as stocks, bonds, or funds—on-chain, it promises broader access and programmable value. But as adoption begins to accelerate, a question emerges: how much of this shift is structural, and how much is narrative?
Today, tokenized financial products are no longer theoretical. Exchanges, custodians, and on-chain protocols have launched live offerings, enabling retail users around the world to gain exposure to US equities or treasury yields using just a mobile wallet.
HTX, as a global exchange, reflects the growing demand for accessible, blockchain-native financial services. In July, it posted a 45% increase in new user registrations, building on strong growth from the first half of the year. According to CoinGecko’s latest quarterly report, HTX ranked second among major exchanges by trading volume growth with a 51.9% quarter-on-quarter increase, reflecting broader momentum across the industry.
Yet while the surface-level appeal is strong, with faster settlement, round-the-clock liquidity, and fractional ownership, the underlying structures vary significantly. So do the risks.
Not all tokenized assets work the same way
As outlined in HTX Ventures’ latest research report, “Are Tokenized Stocks A Treat or A Trap? A Complete Guide,” the current market comprises three primary tokenization models:
- Custody-backed tokens: These are backed by real shares held with licensed custodians. They offer economic exposure but often lack shareholder rights or dividend access.
- Synthetic tokens via CFDs (contracts for difference): These track asset prices without holding the underlying instrument, raising legal and compliance concerns.
- Decentralized finance (DeFi)-based synthetic assets: These are minted through overcollateralized protocols using oracles. They offer permissionless access but elevated smart contract and liquidity risks.
From a user’s perspective, holding a token that tracks Tesla’s share price does not equate to owning Tesla stock. In most cases, voting rights, dividends, and legal ownership are absent.
This gap between perceived and actual ownership presents a long-term trust issue. Without standard disclosures and clear redemption processes, tokenized equities risk becoming instruments of abstraction rather than empowerment.
Beyond access: A shift in market infrastructure
Despite these limitations, tokenization is gaining traction, especially in emerging markets where direct access to US assets is often costly or restricted. By removing traditional brokers and settlement rails, tokenized assets can reduce entry barriers and enable programmable financial tools.
The broader vision centers on infrastructure, not just accessibility. Smart contracts can enable automated compliance, scheduled distributions, and integration with DeFi applications. For fintech developers, this opens the door to building globally integrated asset layers with fewer intermediaries.
However, as noted in HTX Ventures’ report, composability brings its own risks. Oracle failures, protocol dependencies, and delayed redemptions can lead to systemic shocks during periods of volatility. Tokenized asset providers must prioritize audits, circuit breakers, and transparent redemption mechanics to sustain trust at scale.
Regulation is coming, but unevenly
The regulatory landscape remains fragmented. In Europe, tokenized stocks fall under both MiFID (Markets in Financial Instruments Directive) II and the new MiCA (Markets in Crypto-Assets) regulation. While MiFID II governs all securities regardless of form, MiCA expands oversight to include certain asset-backed tokens. In the US, the Securities and Exchange Commission (SEC) maintains that tokenization does not alter the underlying classification of an asset as a security. Any tokenized equity offering to US users must meet strict requirements, including broker-dealer and ATS (alternative trading system) licenses, qualified custody, and full disclosure.
Asia presents a mosaic of approaches. Japan mandates that tokenized securities be issued through licensed banks or trust companies. Singapore focuses on stablecoin reserves and issuer licensing. Hong Kong is piloting a sandbox regime. Meanwhile, jurisdictions like Nigeria remain cautious, citing monetary sovereignty concerns.
For builders, early alignment with local licensing and cross-border compliance frameworks may offer a competitive edge. For users, however, the lack of harmonized rights, especially around redemption, dividends, and ownership claims, remains a blind spot.
What comes next
As HTX Ventures’ report concludes, tokenized assets represent both a new frontier and a regulatory stress test. Without clear frameworks and operational guarantees, products that promise inclusivity may fail to deliver it when it matters most.
Still, the direction is clear: tokenized finance is not a fleeting trend, but a structural shift in how value is accessed and distributed. To fulfill its potential, the industry must focus not just on unlocking participation, but on aligning narratives with on-the-ground reality—through better design, clearer disclosures, and stronger standards.
This article was published in partnership with HTX Ventures.
About the author: This article is authored by Alec Goh, head of HTX Ventures, the global investment arm of HTX, one of the world’s largest cryptocurrency exchanges. Goh leads strategic investments in high-potential digital asset projects, with a focus on infrastructure, compliance-first DeFi, and stablecoin ecosystems. Previously, he spearheaded the firm’s M&A and investment efforts, contributing to its global expansion and some of the industry’s most notable exits. With a background in global finance and deep experience in structured transactions, Goh bridges institutional capital with the next generation of Web3 innovation.