| gm Bankless Nation,
Bitcoin smashes through $120,000 and keeps going. Today's Issue ⬇️ - ☀️ Need to Know: BTC $123K
Bitcoin blows past $120K. - 🗣️ Analysis: How Stock Tokens Level Up
Where they fall short today. - 🎧 Latest Pod: Tokenized Stocks Real?
What they mean for onchain finance.
p.s. The DeFi Report just released its ETH and SOL Q2 reports this morning. Tune in tomorrow at 11am ET to hear Ryan and Michael break down each report in full with earnings call livestreams. Sponsor: Frax — Fraxtal Ecosystem: Where DeFi Meets AI. . . . NEED TO KNOW Bitcoin Hits $123K - 🏃♂️ Pump.fun Raises $500M in 12 Minutes. The memecoin factory's PUMP token sale sold out over the weekend amid Solana frenzy.
- 💸 ETF Giant Grayscale Confidentially Files for IPO. The storied crypto asset manager quietly files to go public amid listing boom.
- 🇰🇿 Kazakhstan Mulls National Crypto Reserve. Its Central Bank is examining allocating seized and state-mined crypto to national reserves.
📸 Daily Market Snapshot: Bitcoin smashed through $120K late last night and carried higher in Monday trading, peaking just above $123K. ETH temporarily remains stuck at $3K, with resistance holding it below $3,100 all weekend. | Prices as of 5pm ET | 24hr | 7d |  | Crypto $3.75T | ↗ 0.8% | ↗ 12.3% |  | BTC $120,040 | ↗ 0.9% | ↗ 11.3% |  | ETH $3,008 | ↗ 0.8% | ↗ 19.0% | . . . ANALYSIS Where Stock Tokens Need to Level Up Tokenized stocks are having a moment – hailed as the next big onchain asset with real-world utility and mainstream appeal. But despite the buzz, these instruments are still in their early days, with clunky infrastructure, regulatory overhang, and a long way to go before they can truly compete with TradFi offerings. Today, we’re exploring how tokenized stocks must change before going mainstream! 🚩 The ProblemsAlthough tokenized stocks are portrayed as a blockchain utilization game changer, these products are early and still have a long way to go. With many tokenized stocks, holders do not get actual ownership in the asset they purchased. Instead, they receive onchain IOUs that grant the ability to redeem tokens for the amount of monetary value (i.e., stablecoins or cash) represented by their holdings. Unlike with conventional stock ownership through a registered brokerage, the convoluted legal wrappers used to create tokenized shares also deprive holders of important rights, such as direct claims to company assets and the ability to vote with their shares. Tokenized stocks can only be redeemed by investors who have onboarded with the issuer, and this feature is not available to residents of “prohibited jurisdictions,” the definition of which varies by issuer and can be altered overnight to comply with legal changes. Compared to digitally native assets, which are held in high regard for their trustless nature and zero reliance on counterparties, tokenized stocks users are entirely dependent on the solvency of a centralized custodian to redeem their claims for monetary value. Further, while only natural to see competition in an emerging crypto economic sector, the proliferation of various tokenized equity standards from different issuers creates undesirable fragmentation, which harms end consumers. 🟢 The SolutionsFor some, like ether.fi’s Mike Silagadze, the recent wave of tokenized stock announcements comes as a “meaningless milestone.” Instead of creating inferior copies of TradFi equities that are dependent on trusted custodians, Silagadze proposes the creation of digitally native “bearer shares,” which empower startups to skirt regulations by listing directly onchain using tokens that act as pseudo-equities. Whereas Silagadze’s proposal for permissionless bearer shares (a.k.a. unregistered stock offerings) is certain to run afoul of regulators, a compliant alternative to pseudo-equities is being pioneered by digital asset manager Superstate via Opening Bell. With Opening Bell, firms can access onchain capital by issuing their stock directly on Solana or Ethereum using tokens that come with built-in compliance mechanisms, such as allow lists and programmatic transfer restrictions. Although Opening Bell departs from Silagadze’s idealistic permissionless vision for the future, it presents a realistic middle ground for issuing tokenized shares with legally enforceable rights that comply with the AML/KYC policies required by almost every nation in existence. Despite Opening Bell’s compliance strengths, its private label model introduces major fragmentation risks. Whether a stock is ported from TradFi or listed natively onchain, liquidity can splinter—across blockchains, between centralized and decentralized venues, or among competing tokens. Buyers also face added friction, like mandatory KYC through Superstate, which limits access and slows adoption. Crypto is no longer the wild west it once was, and while the SEC is allegedly contemplating registration exemptions for securities that are issued as tokens, achieving this still appears to be an uphill battle. Tokenization produces a litany of tangible benefits for equities traders, and while all registered securities will eventually trade through a real-time settlement network, the consequences of fragmentation make it highly probable that only one “blockchain” will process the vast majority of these transactions. Additionally, the generation of stock tokens that succeeds will not have its liquidity fragmented across diverse private label issuers, as this creates an inferior purchasing experience. Tokenized stocks are in the early stages of development, but their present barriers suggest that a single chain with unified issuance standards and a compliant issuance scheme will come to dominate the sector. FRIEND & SPONSOR: FRAX The Fraxtal ecosystem is expanding at lightning speed—this month’s biggest highlight is IQAI.com, the newest Agent Tokenization platform from IQ and Frax. IQ is building autonomous, intelligent, tokenized agents launching on Fraxtal in Q1. Empower on-chain agents with built-in wallets, tokenized ownership, and decentralized governance—all within a fast-growing Fraxtal ecosystem. . . . LATEST POD Are Tokenized Stocks Real? Tokenized stocks have long been a crypto dream, but are they real yet?
Gabriel Otte, founder of Dinari, joins to break down the current landscape. We cover what tokenized stocks actually are, why regulatory hurdles make them complex, how Dinari secured the first broker-dealer license for tokenized public shares, and what this means for onchain finance.
We also explore the limitations of current tokenized stock offerings, Robinhood’s moves, and whether true DeFi composability is possible for equities. Listen to the full episode👇 | 
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