TD Cowen: U.S. investors show little appetite for tokenized stocks

The regulatory framework, announced September 17, allows tokenized venues to utilize automated market makers and liquidity pools for National Market System stocks. However, the requirement that these tokens mirror the economic, voting, and dividend rights of underlying shares has failed to spark adoption. In a case study of Figure, which offers both Nasdaq-listed FIGR shares and blockchain-native equivalents, the conventional instrument captured 99.9% of trading volume, underscoring a clear preference for established market structures.

Reid Noch, vice president of U.S. equity market structure at TD Cowen, highlights that American investors already benefit from deep liquidity and fast execution. Blockchain alternatives currently offer few advantages to offset the operational complexity and restricted liquidity of early-stage platforms. Furthermore, listed companies maintain a veto right, with many showing little interest in authorizing tokenized versions of their securities. Instead, market activity appears to favor perpetual futures—products that offer leveraged price exposure without the complexities of ownership. With firms like Coinbase seeking to expand these derivatives, the focus of the crypto-equity sector is shifting toward synthetic exposure rather than actual tokenized stock ownership.