Coinbase, the leading cryptocurrency exchange in the US, is considering offering tokenized shares of its own stock (COIN) to domestic users through its Ethereum Layer-2 network, Base. This move could revolutionize equity markets by combining traditional stocks with blockchain technology, potentially putting Coinbase at the forefront of financial innovation.
Regulatory Hurdles
While Coinbase is actively exploring this initiative, regulatory compliance remains a significant obstacle. Jesse Pollak, Base's lead developer, emphasized that the company is working closely with regulators to ensure a secure and lawful rollout of tokenized assets.
"We are in an exploratory phase and working to understand what needs to be unlocked from a regulatory perspective to bring assets like $COIN to Base in a safe, compliant, future-looking way," stated Pollak.
Currently, tokenized COIN shares are available only to international users through decentralized platforms. Expanding this access within the US hinges on clearer regulatory guidelines.
Base's Ambitions
Pollak expressed confidence in Base's potential to become a major player in the industry, aiming to manage $1 trillion in assets. He believes that this would solidify Base's position as a hub for next-generation financial solutions.
"We are going to bring $1 trillion assets to Base and it’s going to happen faster than anyone expects," Pollak added.
Tokenization's Potential
The move towards tokenization aligns with the broader industry trend. Bitwise CEO Hunter Horsley believes that tokenization could reshape equity markets by creating a more inclusive and accessible system for smaller businesses.
"Today, there are around 4,600 companies in the US that are able to access the public equity markets. The NAICs estimates there are over 200,000 companies in the US doing over $10M in revenue. Not all companies want to be public of course; but many simply can’t because it requires immense scale. Enter tokenization, a new democratized capital market," stated Horsley.
Coinbase's Leadership
As the first publicly traded crypto exchange in the US, Coinbase has played a significant role in navigating the evolving regulatory landscape. Austin Campbell, an adjunct professor at Columbia Business School, recently praised the firm for its efforts in resisting what he called excessive regulatory overreach against the crypto industry in the US.
January 2025, Cryptoniteuae