The eToro platform has announced the launch of tokenized versions of 100 of the most popular stocks and ETFs on the Ethereum blockchain. This decision will allow traders to access assets around the clock and also use them in DeFi applications.
What is Tokenization?
Tokenization is the process of converting real-world assets, such as stocks and bonds, into a digital format that can be used on a blockchain. eToro plans to implement tokenization, allowing users to trade stocks 24/5, which significantly expands the range of opportunities compared to traditional markets.
Advantages of Tokenized Stocks
One significant advantage of tokenized assets is the ability to withdraw them into personal wallets, which can lead to broader use in DeFi applications. This will allow users to buy tokenized stocks, such as Tesla, and use them for staking or lending through DeFi services. According to an eToro representative, the company aims to bridge traditional and decentralized finance by giving users full control over their tokenized assets.
Future of Tokenized Assets
Although tokenized stocks currently represent only a small part of the real-world asset market, interest in them is growing. For instance, Robinhood launched a new blockchain layer for tokenized stocks with zero commissions for users in Europe. eToro also represents a significant step towards wider adoption of stock tokenization, which, according to CEO Yoni Assia, could "democratize finance" by eliminating intermediaries and barriers that limit access to traditional assets.
The tokenization of stocks represents a significant step forward in the development of financial technologies, offering new opportunities for investors. With growing interest in tokenized assets, this sector may evolve significantly and become more in demand.
