Tokenized Stocks Surge 395% in a Year, But DeFi Adoption Remains Surprisingly Low

Key Takeaways

• Tokenized stocks saw a 395% year-on-year increase in value.
• Most tokens are not being used in DeFi, with only 2.6% being used as lending collateral.
• Traders prefer perpetual contracts over lending or borrowing.
• Ownership remains a concern due to indirect token ownership.

Market & Token Impact

Tokenized stocks are a growing market, with the total on-chain value rising from $640 million to $3.16 billion. However, the growth is largely driven by perpetual contracts, with only a small percentage being used as lending collateral. This suggests that traders are more interested in derivatives than in lending or borrowing against the actual assets.

Broader Context & What's Next

Regulation is also developing differently across regions. The US is moving through SEC exemptions and staff guidance, while Hong Kong, South Korea, and Abu Dhabi Global Market are taking more regulator-led approaches. Hong Kong has already allowed 24/7 secondary trading for tokenized funds on licensed platforms. South Korea is taking a slower route, with wider tokenized-stock access expected after a second phase following its February 2027 registry launch.

Market Trends

• 55% of tokenized stock trading takes place outside regular market hours.
• Sunday evening perp prices correctly pointed to Monday's opening direction 65% of the time across 449 market weekends on Trade.xyz.
• The market now has around 4.04 million tokenized stockholders, with an average balance of about $780.
• The three biggest issuers control roughly 70% of the sector's on-chain value, yet their tokens do not give holders direct ownership of the underlying shares.
• There have been cases involving disputed tokenized products and refunds.
• The Edel Finance manipulation was the main exception, with losses estimated between $353,000 and $403,000.