Now You Can Buy Tokenized Stocks on Binance Exchange and Take Self Custody

• Binance Exchange has launched tokenized stocks for its users on its exchange in partnership with Ondo Finance.
• The launch is a major breakthrough as stocks could be traded globally without much gatekeeping, like other cryptocurrencies.
• Such stocks are nearing a $1 billion market, with BlackRock predicting that all stocks in the world will eventually be tokenized.
• All major exchanges are expected to follow the move.
• Stock purchased on Binance can be taken off the exchange into self-custodial wallets.
• However, for the redemption of stock that a person receives from someone else, KYC could be required.

Related: Binance Expands Trading with Gold and Silver Perpetual Futures

Binance Users Can Now Buy Tokenized Stocks

Binance has launched tokenized stocks on its platform together with Ondo Finance, one of the largest RWA providers. The benefits are available to all Binance users globally, except in a few restricted countries.

Ondo Finance Becomes Ecosystem Enabler

Ondo, one of the largest RWA platforms, has acted as the core partner with Binance to launch tokenized stocks on its platform.

Interestingly, President Trump-linked WLFI has major ONDO reserves in its portfolio.

Global Access to Users

Binance users can access tokenized stocks from around the world due to the decentralized nature of crypto markets. We tested the same from the US and India, and in both places, users were able to access $GOOG and $META.

How can I buy tokenized stocks on Binance?

1. Log in to Binance
2. Go to Binance Alpha
3. Select your choice of stock
4. Checkout using any cryptocurrency, such as stablecoins, money transfer, or card.
5. You will see the stock getting credited in your Assets Section.

Benefits of Buying Tokenized Stocks

Tokenized stocks are expected to add much more market liquidity as compared to traditional stock holdings because crypto markets add several benefits to users:

1. Greater user privacy
2. Efficient Trading with fewer fees
3. Easy custody as compared to traditional demat accounts, which can be frozen due to arbitrary reasons

Limitations

1. Conversion between already held traditional stocks and tokenized ones would be necessary to onboard traditional market users.
2. Redemption is subject to issuer conditions, such as those of Ondo Finance, and may require KYC if you were not the one who purchased them.

What are Tokenized Stocks?

Tokenized stocks are real-world assets that have been converted into tokens by an RWA platform (here, Ondo) to improve trading efficiency, decentralized custody, and easy transferability, and to enable access in a private crypto wallet.

Currently, the traditional stock market size is at $125 trillion, as compared to just $1 billion of tokenized stocks. However, the latter has been growing at a rate of 2800%. In just one year, tokenized stocks rose from a $32 million market size to $1 billion.

Read More: Real World Assets (RWA): What They Are, How They Work & Top 3 RWA Chains

Frequently Asked Questions

Disclaimer: BFM Times acts as a source of information for knowledge purposes and does not claim to be a financial advisor. Kindly consult your financial advisor before investing.