- Coinbase will launch tokenized U.S. stocks abroad, offering dividends, collateral use, and claimed shareholder rights.
- Galaxy’s Alex Thorn says the undisclosed legal structure will determine ownership rights, compliance, and investor protections.
- Recent xStocks allocation failures highlight risks as regulators debate rules for tokenized securities and wrappers.
Coinbase unveiled tokenized U.S. stocks during its June 16 System Update event, promising non-U.S. customers full shareholder rights, dividend payments, and 1:1 backing. However, the company did not disclose the legal structure supporting those claims. According to Galaxy Head of Research Alex Thorn, that missing detail could determine how the product operates, how regulators view it, and how users access ownership rights.
Coinbase Expands Beyond Crypto Trading
The tokenized equities announcement formed part of a broader rollout of 21 products and features. Coinbase said the stock tokens will launch next month for customers outside the United States. The company also stated that users can lend the tokens for yield and use them as collateral.
Alongside the stock offering, Coinbase introduced the B20 token standard on Base. The compliance framework includes layered policy controls. However, Coinbase has not explained how the standard connects to its tokenized stock product.
The company also launched Coinbase Advisor, an AI-powered investment tool. According to Coinbase, the service is registered as a Registered Investment Adviser with the SEC and as a Commodity Trading Advisor with the National Futures Association. Additional announcements included crypto and stock options trading, RWA and pre-IPO perpetuals, a privacy platform for enterprises, and bitcoin-backed mortgages through Better.
Focus Turns To Ownership Structure
According to Thorn, tokenized stocks generally follow two structures. The first is an issuer-sponsored model. The second relies on third-party entities that hold assets and issue blockchain-based representations.
Thorn said Coinbase has not revealed which model supports its product. However, he noted that the company may use a third-party wrapper structure similar to xStocks. Under that arrangement, an intermediary holds the shares while token holders receive rights through contractual agreements.
That distinction remains important because Coinbase described the product as providing “true equity ownership.” Alex Thorn noted that if a wrapper entity stands between investors and the underlying company, shareholder rights and dividends would likely depend on agreements with that intermediary.
SpaceX Allocation Issues Highlight Risks
The debate arrives shortly after problems involving tokenized SpaceX allocations. Several platforms, including Binance Wallet, Bybit, and Bitget, marketed reserved allocations linked to xStocks. However, the transactions later unraveled when the shares did not arrive.
According to Thorn, Bybit informed customers that xStocks could not deliver the underlying assets. Meanwhile, Kraken and xStocks users reportedly received only a portion of requested allocations.
The discussion also coincides with ongoing regulatory debates. Thorn noted that the SEC has not finalized its proposed innovation exemption for tokenized securities. Reports indicate officials continue to debate whether relief should apply only to issuer-backed tokens or extend to third-party wrappers. Meanwhile, the CLARITY Act remains pending in the U.S. Senate.
