The investment world is buzzing. Online trading giant eToro has just rolled out a new feature: tokenized shares built on the Ethereum blockchain. This move puts them right in the thick of a global race to turn traditional assets into digital tokens. It’s a bold step, especially since main rival Robinhood launched a similar product just last month.
This means eToro users can now trade US stocks on the Ethereum blockchain. The firm, which hails from Israel, announced the expansion this week in a press release. Their goal is clear: make trading stocks possible 24 hours a day, 7 days a week. Beyond constant trading, tokenization also links the stock market with decentralized finance (DeFi) applications. This opens up a whole new world of possibilities.
The first batch of tokenized shares includes the 100 most popular US stocks and exchange-traded funds, also known as ETFs. These shares will exist as ERC-20 tokens, which is a common type of digital token. eToro made sure to say that these tokens can always be swapped back for regular shares. The company sees this as a key step toward a fully tokenized future.
“We’ve long believed in a tokenized future,” said Yoni Assia, eToro’s co-founder and CEO. “Our aim is to tokenize every asset on eToro, starting with stocks. This allows our users to move these digital assets onto the blockchain and bring them into the larger DeFi system.”
Tokens for a New Era, Available All the Time
Assia believes blockchain technology will lead to a massive transfer of wealth. He thinks this will happen as traditional assets transform into digital tokens and move onto the blockchain.
eToro’s announcement comes as financial companies are increasingly adopting tokenization. This trend is partly fueled by governments in places like the United States and Europe. Regulators are creating rules that are friendly to these new digital assets.
“New rules, like MiCA in Europe and the Genius Act in the United States, create a fresh chance,” Assia stated. “They let us turn real-world assets into digital ones that are legally backed and regulated.”
Simply put, tokenization means taking a real asset, like a stock or a bond, and creating a digital version of it. This digital version, or “token,” lives on a blockchain.
“Tokenization removes limits. It offers clear records and control,” Assia explained. “It can make finance open to everyone, putting assets within reach for more people.”
eToro Joins the Tokenization Chase
This new offering places eToro right next to its big competitors. Many are now embracing tokenization as traditional finance and cryptocurrencies blend together. Robinhood, for instance, introduced its own US stock tokens for European users on the Arbitrum network just last month.
Other large crypto exchanges are also in on the action. Bybit, Kraken, and Gemini have all recently started offering tokenized stocks. Even Coinbase is reportedly trying to get official approval to do the same.
eToro isn’t new to this space. They’ve been working on tokenization for a while. Their journey began in 2019 when they bought Firmo, a Danish tokenization startup.
On top of tokenized stocks, eToro is also expanding its futures trading. They are one of the first platforms to offer futures that are tied to current prices, working with CME Group. This gives users more flexibility to trade in both stock and crypto markets.
“Trading around the clock, five days a week, whether it’s US stocks or spot-quoted futures, lets users react to market news in real-time,” Assia noted. “Or they can simply trade when it suits them. We will keep adding to this offering, so our users decide when they trade.”