In a recent post on the X platform, Jesse Pollak, developer at Coinbase’s Ethereum layer-2 network, Base, revealed that the company is considering making tokenized shares of its stock available to United States users of Base.
According to Pollak, tokenized COIN shares are already accessible to non-US users through protocols such as Backed, a tokenized real-world assets (RWA) platform. However, he noted that Coinbase has "no concrete plans right now" and is in an "exploratory phase" as the exchange works to understand how to navigate US regulations.
Navigating US Regulations
Pollak emphasized the need for regulatory clarity and improvements that embrace on-chain platforms, stating: "We need regulatory clarity and improvements that embrace onchain as an open platform to unlock this for everyone."
This sentiment is echoed by Colin Butler, Polygon’s global head of institutional capital, who has stated that tokenized RWAs – including tokenized securities – represent a $30 trillion market opportunity globally. In August, Cointelegraph spoke with Butler about the potential impact of tokenization on US markets.
Tokenization: A Transformative Force
The concept of tokenization is gaining traction worldwide, and its potential to transform US markets is significant. Tokenized RWAs can provide a more accessible and efficient way for investors to engage with traditional assets, such as stocks and bonds.
However, the regulatory landscape in the United States remains unclear, making it challenging for companies like Coinbase to implement tokenized share offerings. As Cointelegraph Research noted, US crypto stocks like COIN saw massive gains following Donald Trump’s victory in the presidential election, sparking optimism about the future of the industry.
Donald Trump’s Impact on Crypto
In November, COIN surged more than 20%, pushing the stock past $300 for the first time since 2021. Analysts say that Trump’s presidency is likely to be more favorable to the cryptocurrency industry, with reduced regulatory pressure on firms like Coinbase.
According to Michale Miller, an equities researcher at Morningstar, "We see Coinbase as a beneficiary of the election results as the firm has been struggling with regulatory pressure from the SEC, with the firm actively fighting the agency in court."
Regulatory Clarity: A Necessary Step
Clearer US rules are crucial for crypto adoption, particularly for tokenized securities like COIN. Under President Joe Biden, the US Securities and Exchange Commission has brought more than 100 enforcement actions against cryptocurrency companies for purported violations of securities laws.
However, investment bank Citi suggests that the US is moving towards a broader framework passed by Congress, rather than relying solely on regulation through enforcement. While this shift is promising, legislation in the United States lags behind other major jurisdictions.
The Future of Tokenization
As Pollak noted, "every asset in the world will be on Base." This vision is ambitious but aligns with the potential of tokenization to transform traditional markets. By providing a more accessible and efficient way for investors to engage with assets, tokenized RWAs can unlock new opportunities for growth.
However, regulatory clarity remains essential for the widespread adoption of tokenization. As Coinbase continues to explore the possibility of offering tokenized shares on Base, it is clear that the company is committed to navigating the complexities of US regulations.
Conclusion
The potential of tokenization to transform US markets is significant, with a $30 trillion market opportunity globally. However, regulatory clarity remains essential for widespread adoption. As Coinbase continues to explore the possibility of offering tokenized shares on Base, it is clear that the company is committed to navigating the complexities of US regulations.
By embracing on-chain platforms and promoting regulatory improvements, companies like Coinbase can unlock new opportunities for growth and innovation in the world of tokenization.