Coinbase Global, Inc. (NASDAQ: COIN), the leading U.S.-based cryptocurrency exchange, is making waves in the financial world by seeking approval from the U.S. Securities and Exchange Commission (SEC) to offer tokenized equities, a groundbreaking initiative that could transform stock trading by leveraging blockchain technology.
This strategic push, described as a “huge priority” by Coinbase’s Chief Legal Officer Paul Grewal, positions the company to compete directly with retail brokerage giants like Robinhood (NASDAQ: HOOD) and Charles Schwab (NYSE: SCHW), while potentially unlocking a new era of 24/7, low-cost, blockchain-based trading.
What Are Tokenized Equities?
Tokenized equities are digital representations of traditional company shares, converted into blockchain-based tokens similar to cryptocurrencies.
Instead of holding physical or electronic stock certificates, investors own tokens that reflect ownership in the underlying securities.
This model promises several advantages:
- 24/7 Trading: Unlike traditional stock markets limited by trading hours, tokenized equities can be traded around the clock on blockchain networks.
- Lower Costs: Blockchain technology eliminates intermediaries like clearinghouses, reducing transaction fees.
- Faster Settlements: Blockchain enables near-instantaneous trade settlements, compared to the T+1 or T+2 systems used in conventional markets. This would be massive for retail investors.
However, challenges remain.
A recent World Economic Forum report highlighted insufficient secondary-market liquidity and the absence of global standards as key hurdles to widespread adoption.
Coinbase’s Regulatory Push
Coinbase is navigating a complex regulatory landscape to bring tokenized equities to the U.S. market, where such trading is not yet permitted.
The company is seeking a “no-action letter” or exemptive relief from the SEC, which would provide assurance that the agency will not pursue enforcement actions against the offering.
Grewal emphasized that this regulatory clarity is critical for boosting institutional adoption of blockchain-based financial products, stating, “It’s that confidence that has been lacking so far, and I think really held back a lot of the institutional adoption.”
While Coinbase already holds a dormant broker-dealer license through a 2018 acquisition, it is not currently registered as a broker-dealer for traditional securities trading, a requirement for most platforms offering stock trading.
The company’s request for SEC approval marks a critical step toward bridging traditional finance and blockchain innovation.
Coinbase’s timing aligns with a shifting regulatory environment under the Trump administration, which has taken a more crypto-friendly stance.
The SEC, now led by new chair Paul Atkins, recently dropped enforcement actions against major crypto firms, including Coinbase, Binance, and Kraken, and established a dedicated crypto task force to develop digital asset regulations.
This contrasts with the Biden-era SEC, which halted Coinbase’s earlier attempt to tokenize its own stock in 2021.
Coinbase’s Chief Financial Officer, Alesia Haas, noted in March 2025 that renewed discussions with regulators under the current administration have fueled optimism.
“I’m now excited that we may be able to re-engage those conversations with the SEC’s task force,” she said, signaling confidence in advancing tokenized securities.
Competing with Robinhood and Beyond
If approved, Coinbase’s tokenized equities platform would position it as a direct competitor to retail brokerages like Robinhood, known for its commission-free trading, and Charles Schwab, a stalwart in traditional investing.
Notably, Robinhood has also explored tokenization, submitting a 42-page proposal to the SEC in May 2025 for regulatory clarity on tokenized real-world assets (RWAs).
This suggests a broader industry trend toward integrating blockchain with traditional finance.
Coinbase’s initiative could also challenge rival crypto exchange Kraken, which launched tokenized U.S. equities, dubbed xStocks, in select international markets in May 2025.
By bringing similar offerings to the U.S., Coinbase aims to capture a share of the $25 trillion U.S. equities market while enhancing blockchain’s role in mainstream finance.
Also Read: SEC Now Responds to Retail Investors on Illegal Manipulation
Industry Implications and Market Sentiment
The move has sparked enthusiasm in the crypto community, with posts on X calling it a “missing bridge between TradFi and DeFi” and praising its potential for faster settlements and greater transparency compared to traditional brokers.
Analysts suggest that a successful launch could pressure competitors like Robinhood and Schwab to accelerate their own blockchain adoption timelines.
Market observers see Coinbase’s inclusion in the S&P 500 index as a sign of its growing mainstream credibility, further amplified by this bold venture.
If approved, Coinbase could become the first U.S.-regulated platform to offer 24/7 stock trading with instant blockchain settlement, potentially by Q4 2025.
While Coinbase has not confirmed whether it has formally filed its SEC request, the company’s proactive engagement signals a strong commitment to innovation.
Grewal’s March 2025 response to an SEC inquiry underscored the need for tailored regulations to support tokenized securities, a stance Coinbase continues to champion.
As the SEC’s crypto task force evaluates Coinbase’s proposal, the decision could set a precedent for tokenized asset regulation globally, influencing frameworks like the EU’s Markets in Crypto-Assets (MiCA).
For now, investors and industry watchers await further developments, with Coinbase poised to redefine the intersection of Wall Street and blockchain technology.
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