Investors are embracing blockchain-based shares for after-hours trades and fractional ownership, but the International Monetary Fund cautions that liquidity, legal frameworks, and settlement systems have not kept pace.
Tokenized stocks are successfully delivering two of the cryptocurrency sector’s most enduring promises: around-the-clock market access and the ability to purchase fractions of a single share. However, according to a comprehensive new study released by the International Monetary Fund (IMF), these blockchain-backed equities remain markedly less liquid and significantly more volatile than the conventional traditional equities they track.
The findings form a central part of the IMF’s latest Global Financial Stability Report, titled Scaling Tokenization: New Efficiencies and New Vulnerabilities. The study closely examines five of the most actively traded tokenized U.S. equities—including shares of tech giants Tesla, Nvidia, and Alphabet, alongside broader market measures like the Nasdaq 100 Index—across a mix of both centralized and decentralized trading venues.
The data gathered by the IMF highlights clear consumer appetite for blockchain-based financial products. More than half of all trading activity analyzed took place outside of regular U.S. market hours, and approximately 80% of individual trades were for less than a single share. For the authors of the report, these metrics serve as clear evidence that investors genuinely value continuous 24/7 access and lower financial entry points, rather than simply being interested in the underlying cryptographic technology powering a tokenized stock.
Furthermore, the study uncovered that overnight price movements in tokenized stocks often carry valuable predictive information for the underlying traditional shares. Once official U.S. stock exchanges opened for the day, more than 85% of the overnight price movement observed in tokenized shares was fully reflected in their traditional market counterparts within a remarkably brief window of five minutes.
Industry leaders acknowledge that while the technological leap is significant, operational efficiency remains paramount. "Moving assets onchain is only the first step," said Bitget CEO Gracy Chen, addressing the broader implications of the shift. "The bigger question is how efficiently that capital can work once it is there."
The fundamental message from the IMF is that while the underlying use case is entirely real, the market itself remains remarkably nascent. The institution noted that the broader tokenized real-world asset market has expanded at a rapid pace, estimating its total value at approximately $65 billion as of July 31. Within that ecosystem, tokenized equities accounted for roughly $2.3 billion of the total valuation. To put that figure into perspective, the global equity market capitalization for 2025 stood at just under $160 trillion, according to data from the Securities Industry and Financial Markets Association, the prominent trade group representing the U.S. securities industry.
Despite the current size differential, the tokenization project continues to attract major institutional players and expanding corporate infrastructure. Bullish, a Gibraltar-based digital asset exchange and the parent company of CoinDesk, officially introduced tokenized equity trading to its platform in August. Meanwhile, digital asset platform OKX and Intercontinental Exchange—the prominent parent company that owns and operates the New York Stock Exchange—filed formal plans earlier this month for a dedicated trading venue designed specifically to offer round-the-clock trading in tokenized U.S. shares.
These platforms are far from alone in the space. Established cryptocurrency exchanges including Coinbase Global, Kraken, and Binance all facilitate tokenized stock trading, alongside prominent retail brokerage platform Robinhood Markets.
Yet, as the market expands, structural hurdles persist. According to the IMF’s analytical breakdown, tokenized stocks traded at roughly 1.5 times the volatility of equivalent shares on traditional trading venues, while simultaneously suffering from significantly reduced market depth and liquidity.
The underlying difficulty is not merely that blockchain-based financial markets are currently small in scale. For tokenization to successfully deliver its promised savings in both transaction costs and settlement time, the ecosystem requires a critical mass of issuers, investors, trading venues, and settlement assets operating seamlessly on compatible systems. Presently, the market remains heavily fragmented across private platforms, public blockchains, disparate custodians, and varying settlement tools that frequently lack interoperability.
The IMF highlighted that tokenization holds the theoretical potential to eliminate much of the manual labor financial firms currently undertake to reconcile records, while also automating routine tasks such as dividend distributions and accelerating the transfer of collateral. However, the report simultaneously issued a stern warning: automated margin calls and liquidations, collateral constantly shifting between platforms, and continuous 24-hour trading could collectively make a sudden market shock significantly harder to contain.
At present, these systemic risks remain relatively contained simply because tokenized markets themselves remain small, according to the IMF. Nevertheless, the report concludes that foundational legal rules governing asset ownership, robust safeguards for market liquidity, secure technical links between disparate systems, and modernized settlement arrangements must be thoroughly developed before the tokenized equity market expands to a systemic scale.
