SEC Decision on Coinbase Tokenized Equities May Shift the Market

In a groundbreaking shift, Coinbase is seeking approval from the U.S. Securities and Exchange Commission (SEC) to launch a new service: Coinbase tokenized equities. If approved, this would allow users to trade traditional U.S. stocks like Apple or Tesla via blockchain, similar to how cryptocurrencies are traded.

According to a post by Wu Blockchain on X, Coinbase’s Chief Legal Officer Paul Grewal said the plan is a “huge priority” for the company. This bold move could place the exchange in direct competition with platforms like Robinhood and Charles Schwab—but with a modern Web3 twist.

Source: Wu Blockchain

What Are Tokenized Equities and Why Should You Care?

Tokenized equities are digital tokens that represent shares in a company. Instead of holding a paper certificate or a digital record at a broker, you’d own a token on the blockchain. These tokens can be traded instantly, with lower fees and 24/7 availability.

This idea is at the center of Coinbase tokenized equities , which is trying to modernize the way Americans invest in stocks. Advocates think it will:

• Reduce trading costs

• Enable instant settlement

• Allow trading on weekends and holidays

The Regulatory Roadblock: Why Coinbase Needs SEC Approval

Currently, U.S. law does not allow trading crypto-backed versions of U.S. equities. It must either:

• Receive a No-Action Letter from the SEC (a promise not to sue them), or

• Be granted exemptive relief (a special regulatory pass)

It is not registered as a broker-dealer, which makes approval more complicated. But Grewal says that getting this green light would give the company and investors “confidence” that the product is compliant with U.S. law.

Kraken and Others Are Already Testing Digitized Stocks

In the latest Coinbase news , other companies are moving fast. Kraken recently launched xStocks—tokenized U.S. equities available in markets outside the United States. Similar efforts from Backed Finance and Swarm Markets are also gaining momentum in Europe and Asia.

But so far, none of these platforms can legally offer these services inside the U.S.—which is why these equities could be a game-changer if approved.

Key Challenges Ahead for Tokenized Equities

Even though the technology sounds promising, there are still major issues to solve:

• Lack of secondary market liquidity

• No universal standard for digitized assets

A recent World Economic Forum report highlighted these gaps, suggesting that more regulation and market depth are needed before full adoption is possible.

Changing Winds: The Trump Effect on Crypto Regulation

The political environment around crypto has also changed. Under President Trump’s administration, the SEC has dropped lawsuits against major players like Coinbase, Binance, and Kraken. A new crypto task force has also been formed to rewrite rules for digital assets.

This regulatory shift may work in exchange favor as it pushes for digitized equity trading in the U.S.

Final Words: Will This Change How America Trades Stocks?

With Coinbase tokenized equities, we could be looking at the future of stock investing—instant, decentralized, and open round the clock. While there’s no timeline yet for the product’s release, all eyes are now on the SEC’s next move.

If approved, this could unlock a new business model for this exchange and give American investors a cutting-edge way to trade stocks—on-chain and without borders.