TD Cowen Sees Limited Demand for Stock Tokens Despite SEC's Conditional Approval of On-Chain Trading
Summary
- TD Cowen said investor demand for related products will likely remain limited even after the SEC conditionally allowed on-chain trading of stock tokens.
- TD Cowen said US investors already have easy access to equities, meaning tokenized trading platforms must offer enough advantages to offset limited liquidity and operational complexity.
- TD Cowen also said perpetual contracts remain a more attractive vehicle for investing in crypto-related stocks, with trading volumes far above those of tokenized spot products.
Forecast Trend Report by Period
TD Cowen expects demand for stock tokens to remain limited even after the US Securities and Exchange Commission conditionally allowed on-chain trading of the products.
CoinDesk reported on September 21 that TD Cowen said US investors already have easy access to equities. Tokenized trading platforms will need to offer benefits compelling enough to offset limited liquidity and added operational complexity.
TD Cowen said it had spoken with dozens of stock issuers and found little interest in stock tokens outside crypto companies such as Figure. That included many consumer-facing businesses.
The bank also said perpetual contracts remain a more attractive way to gain exposure to crypto-related stocks. Trading volume in perpetuals is also far higher than in tokenized spot products.
JH Kim
reporter1@bloomingbit.ioHi, I'm a Bloomingbit reporter, bringing you the latest cryptocurrency news.