Securitize CEO Advocates for Tokenized Stocks to Expand $5 Trillion Market

Tokenized Stocks as a Catalyst

On a panel at ETHConf, Carlos Domingo, the CEO of Securitize, argued that tokenized equities and exchange-traded funds (ETFs) could significantly expand the real-world asset (RWA) market, estimating it could grow from approximately $30 billion to around $5 trillion. Domingo emphasized that even a small fraction of the global equities market, valued at roughly $150 trillion, moving to blockchain could transform the financial landscape.

Market Potential and Institutional Support

Domingo commented, "Only if a small percentage of that, like 2% or 3%, moves onchain, it gets you very close to that $5 trillion." His remarks coincide with Securitize's plans to go public and its efforts to enhance its position as a leading player in institutional tokenization, alongside partners such as BlackRock.

While tokenized U.S. Treasuries have been prominent in the RWA sector, Domingo believes that the future growth will stem from tokenized stocks. Securitize has established partnerships with the New York Stock Exchange and Computershare to facilitate on-chain trading and settlement of equities. Domingo criticized many current offerings of tokenized equities as synthetic products that do not provide investors with actual ownership rights, such as voting and dividends.

Real Tokenization and Emerging Markets

Highlighting the importance of true tokenization, he stated, "A lot of people that today say that they tokenize equities, they’re not tokenizing equity," indicating that many of these offerings rely on derivatives rather than offering actual ownership. Domingo aims for blockchain-based securities to secure the same rights as traditional shares while improving efficiency through instant settlement and 24/7 transferability, in addition to deeper connections with decentralized finance (DeFi).

He reinforced that public blockchains like Ethereum are optimal for institutional use in tokenization, despite existing concerns about compliance and transparency. Securitize employs smart contracts to restrict ownership to approved investors, while still allowing assets to function on open networks.

Looking Ahead

Domingo anticipates that blockchain markets will evolve alongside conventional financial systems, eventually commanding a significant share of financial activities. He stated, "The traditional markets are going to stay; we're going to see a new market emerge in parallel that will run on blockchain rails and be much more efficient." This perspective underscores the visionary potential of tokenized assets in reshaping the financial marketplace, with Securitize positioning itself at the forefront of this evolution.