It is not the crypto world swallowing Wall Street, but rather two financial worlds beginning to merge.

Written by: Liu Honglin

A few years ago, if someone had said that in the future you could buy stocks of Apple, Tesla, and Nvidia on a blockchain, most people's first reaction might have been: isn’t that just turning stocks into tokens? Even many people in the crypto industry might further imagine: since it has turned into a token, does that mean we won’t need brokers, exchanges, or clearinghouses anymore? With just a wallet, can we trade U.S. stocks freely 24/7 around the world like trading USDT?

This imagination is half becoming reality, but the other half might be completely wrong.

In 2026, something worth paying attention to is happening in the U.S. capital markets. On March 18, the U.S. Securities and Exchange Commission (SEC) officially approved Nasdaq to amend trading rules, allowing eligible securities to be traded in tokenized form on Nasdaq.

By September 17, the SEC further introduced an "Innovative Exemption," allowing eligible tokenized securities trading venues to use blockchain, automated market makers, and liquidity pools to trade tokenized U.S. stocks under certain conditions.

If we look at these two things together, their significance far exceeds the notion of "the U.S. allowing stock tokenization." What the U.S. is truly beginning to try is a much larger proposition: can Wall Street be moved onto the blockchain?

Of course, "move" here does not mean shutting down the New York Stock Exchange, nor does it mean getting rid of the SEC, and certainly does not mean that everyone can anonymously open a wallet to speculate on U.S. stocks. On the contrary, what the U.S. is trying to do may be more complex and more realistic: to retain the securities laws, public companies, shareholder rights, and regulatory systems that have been functioning for over a century while gradually migrating some of the underlying technologies that support this system from traditional databases to blockchain.

If this experiment ultimately succeeds, then what blockchain truly changes may not be “what stocks look like,” but rather the entire back end of the capital markets.

What does it mean for stocks to go on-chain?

Many people today talk about RWA, or the tokenization of real-world assets, and one of the most confusing things is: is the token actually that stock?

This question is very important because, on the surface, everyone calls it "tokenized stock," but the underlying legal relationship can be completely different.

On January 28, 2026, the SEC's Division of Corporation Finance, Investment Management, and Trading and Markets released a staff statement roughly categorizing the tokenization of securities into two types: tokenization by the issuer or an institution representing the issuer, and tokenization by an unrelated third party to the issuer. This is a staff interpretation of different structures, not a universal pass for all tokenized stocks.

These two things look very similar, but they have completely different legal meanings.

Taking Apple stock as an example, if the issuer or its agent connects the blockchain to the official securities holder registration system, then the transfer of the token can correspond to the transfer of securities rights. However, the issuer’s participation does not necessarily mean that the final registration must occur on-chain: another approach might involve notifying the issuer of on-chain transfers and then updating the off-chain shareholders' register. To determine what exactly the investor holds, one must look at how the token ties to the legal registration records.

The second model is much more complex. A platform could first buy one share of Apple stock and hold it in a custodian, then issue a separate Apple stock token to you; or it might take it further by not transferring ownership of that share to you at all, but merely signing a derivative contract with you stipulating that if Apple rises 10%, your token also rises 10%.

These three things might all appear as "AAPL" on your mobile screen, but legally, they are not the same asset: one might be a true stock, another might be a security interest supported by stocks, and yet another might just be a contract tracking Apple's stock price.

This is precisely the most important starting point for understanding today’s changes. Whenever we see any so-called "stock tokens" in the future, the first question should not be which chain it is on, but rather: what are the legal rights behind this token?

The Nasdaq rules that the SEC approved in March revolve around the tokenization pilot involving the U.S. Depository Trust Company (DTC). Eligible securities can be traded in either traditional or tokenized form; the two forms must be interchangeable, using the same stock code and security identification codes, granting the same rights, and entering the same order book while following the same matching priority. The specific applicable securities, participants, and settlement methods are still subject to the pilot conditions.

Suppose you purchase one share of Nvidia that meets the pilot conditions, choosing tokenized settlement does not mean you are buying a separate "NVDA coin." The rules intend to retain the economic identity of the same security, allowing investors to choose different holding and recording forms. It also does not mean that all on-chain products tracking NVDA are automatically equivalent to that stock.

Nasdaq even explicitly requires that tokenized securities must be interchangeable with traditional forms of securities, granting investors the same rights and privileges. So if a simple metaphor is needed, Nasdaq is not reinventing stocks but is trying to change the database behind them.

In the past, stocks were registered in layers of ledgers at brokers, custodians, and clearing systems; now the U.S. is beginning to explore: can part of those ledgers run on blockchain?

This is also why I feel that merely understanding this matter as "RWA is hot again" undervalues its importance.

What are the differences with Binance, Robinhood, and Ondo?

From the perspective of regular users, a common question arises: Nasdaq, Binance, Robinhood, and Ondo are all talking about stock tokenization, so what are the differences between them? First, we need to clarify the roles: Nasdaq is discussing trading venues and market rules; specific products must still look at who issues, who holds, who provides trading access, and what rights investors ultimately acquire.

The answer is still that statement from earlier: do not look at the name of the token; look at the legal structure behind the token.

First, let’s look at the Classic Stock Tokens of Robinhood’s European business. According to its official product description, these products are derivative contracts tracking the prices of stocks or exchange-traded products between users and Robinhood, which do not directly confer rights to the underlying stocks, nor do they bring about shareholder voting rights. This refers to this specific product and cannot be generalized to all products under the same brand in other jurisdictions or with other structures.

Therefore, purchasing such a stock token from Robinhood is not legally the same as actually buying a share of Apple stock in a U.S. brokerage account.

Next, consider the bStocks provided by Binance as a trading entry point. Its issuer is the Binance Group's affiliated company, BTech Holdings Limited. The official disclosure states that each unit of product is backed 1:1 by underlying securities held by a regulated custodian, but bStocks themselves are not the stock of the underlying publicly listed company, nor do they make the holder a direct shareholder of that company. Whether it can be exchanged for stocks, how dividends and corporate actions are handled must continue to refer to the issuance document and platform rules; having asset support and direct shareholding are still two different matters.

The July case involving Ondo and Broadridge concerns custodial tokenized securities of Micron stock and BlackRock’s IVV ETF, as well as governance functions such as shareholder communication and voting. This shows that third-party participatory structures can also connect traditional equity rights, but does not imply that all third-party stock tokens grant the same rights.

Thus, when comparing these products, one cannot simply look at whether they all say AAPL on the screen. Price exposures, custodial security rights, and forms of tokenized records for the same security; the underlying claims, transfer conditions, and risk bearance are different. The brand of the trading entry does not replace the need to verify the issuer and custodial arrangements.

For investors, the most practical question is: if the platform or issuer goes bankrupt, who can you claim what rights from? Is it to demand delivery of the underlying securities, recover segregated assets, or can you only claim your rights based on the contract? The answer depends on specific legal documents, asset segregation, and applicable laws. For institutions creating products and Web3 lawyers, these arrangements must be clarified before launch; they cannot be left to be explained after issues arise.

How will Wall Street's backend be moved from trading to settlement?

When we look at the stock market, the most visible thing is the trading interface: how much for Apple, how much for Nvidia, click to buy, and then complete the transaction. Thus, it is easy for us to think that the core of the stock trading system is "matching."

However, in reality, after a securities transaction is executed, the truly complex issues just begin.

Who is the buyer, who is the seller? Has the money arrived? Has the stock been delivered? Where is the final ownership registered? How do brokers reconcile with each other? How does the central clearinghouse process? How do custodians keep records? How are dividends distributed? How is voting confirmed? How will things be handled after stock splits, mergers, or delistings?

All these components together form the massive post-trade infrastructure of the modern securities market.

Therefore, the real interest of the U.S. capital markets is not only about "matching a stock trade on-chain," but rather: if the securities themselves become a programmable on-chain asset, can trading, clearing, settlement, registration, and corporate actions begin to converge?

SEC Commissioner Mark Uyeda, when discussing securities tokenization this year, also mentioned the aspects of issuance, trading, transfer, settlement, and ownership records. What is truly worth noting is whether actions that were previously carried out by different institutions, databases, and time nodes can potentially be completed within one set of shared ledgers or even in a single on-chain transaction in the future.

Today, when you click "buy" once at an exchange, what happens behind the scenes is actually a long list of collaborations among financial institutions and databases. In the future, theoretically, a single on-chain asset transfer could simultaneously become the transaction record, settlement record, and ownership change record, and even further trigger custodial and corporate actions.

Provided that the appropriate cash settlement tools, legal validity, and risk control arrangements are in place, on-chain systems have the opportunity to more closely connect the delivery of securities and payment. However, trading, clearing, settlement, and ownership registration are still different stages and will not automatically complete all at once due to a single on-chain transfer.

This may be the real efficiency revolution that blockchain can bring to the capital markets.

Beyond the backend, new options are also beginning to appear for how trades are conducted. On September 17, the SEC launched an "Innovative Exemption," opening a temporary, conditional path for certain on-chain trading venues.

This arrangement allows qualifying tokenized securities trading venues to use permitted automated market makers and liquidity pools to trade specific tokenized U.S. stocks. Automated market makers are trading mechanisms that quote according to program rules; liquidity pools concentrate assets used for trading. But the exemption places limits on the number of securities and trading volume and requires verification of holder rights; when the underlying stock is suspended on the main exchange, related on-chain trading must also halt.

What has been opened is partial regulatory requirements for trading venues after fulfilling certain conditions, not the elimination of securities regulation. The relevant exemptions have a time limit, and the market is still exploring which rules need adjustment.

In the past, we were accustomed to dividing the financial world into two parts: one side comprises Nasdaq, the New York Stock Exchange, brokers, central clearing and order books; the other side includes Uniswap, automated market makers, liquidity pools, wallets, and blockchain. For a long time, people thought that these two worldviews were completely different.

But now the SEC is beginning to allow a combination that was previously hard to imagine: stocks remain securities, but the trading mechanisms can start to learn from decentralized finance.

Stocks are still stocks, securities laws are still securities laws, public companies are still public companies, the SEC is still the SEC. Yet the asset carriers can turn into tokens, ownership registration can use blockchain, trading venues can have automated market makers, settlements can gradually migrate on-chain, and investors can manage assets through wallets. Assets may also further enter into collateral, lending, and other on-chain financial agreements.

The regulatory framework has not been overturned, but the underlying technological infrastructure supporting the regulatory framework is being redesigned by blockchain.

More important than 24/7 trading is asset "programmability"

Following this logic further, a very natural question arises: if stocks truly go on-chain, will they be able to trade 24/7 in the future?

Blockchain provides the technical conditions for round-the-clock transfer and trading, but whether the securities market can operate continuously still depends on trading rules, market-making liquidity, and whether the underlying securities’ subscription, redemption, and risk controls can keep pace. Technically, there is no Saturday, but that does not mean financial institutions and the underlying market are ready for year-round operation.

Some products have already extended trading hours. For example, Binance officially describes bStocks as a product that can be traded at all times. However, the token market opening for trading and the underlying stock market opening for trading still remain two different realities.

Being able to buy and sell over the weekend does not mean sufficient transaction prices can be achieved during that time. When the underlying market is closed, market makers have fewer options for hedging and replenishing inventory, and bid-ask spreads may widen, while on-chain prices may also deviate from the most recent transaction price of the underlying securities.

Suppose significant news about Nvidia occurs on a Saturday: the related token market could reflect investors' judgments in advance, but that price may not equal the price of the underlying stock after trading resumes. For users, there are more trading opportunities, including the possibility of bearing significant price deviations during times of insufficient liquidity.

Once this occurs, traditional meanings of "opening price" and "closing price" will start to lose some significance. Further, the market-making system, options pricing, margin systems, risk management, global liquidity distribution, and even the timing of information disclosure by publicly listed companies may all be affected.

So, 24/7 trading does not just mean “trading stocks at night.” Once the capital market becomes an around-the-clock market, many systems built around opening and closing times on Wall Street will need to be rethought.

If simply extending trading hours from a few hours daily to 24/7 is considered, I believe it still falls short of explaining the real changes that securities going on-chain may bring. The deeper change is that financial assets begin to have the opportunity to be directly recognized, called upon, and combined by programs.

Today, if you hold 100 shares of Nvidia in a traditional brokerage account, that is undoubtedly your asset. However, from an internet perspective, those 100 shares of Nvidia still exist within a relatively closed financial system. Theoretically, you can use them as collateral, sell them, or participate in various financial services, but each use often requires entering a specific institution’s system. You cannot easily authorize a program to take 30 shares as collateral for liquidity, use another 20 shares for other financial strategies, and let an AI manage the remaining positions according to pre-set risk rules, as you would with an internet service.

The issue is not that these financial functions do not exist, but that today fulfilling these tasks requires crossing different institutions and databases. Brokers have their ledgers, banks have their ledgers, fund companies have their ledgers, and custodians and payment institutions have their own systems. Assets can certainly move between these institutions, but with every step of movement, there may be identity verification, authorization, clearing, reconciliation, custody, and compliance processes. This is also why traditional finance, although highly electronic, has not yet truly achieved "composability" in the sense of the internet.

If stocks truly become on-chain assets, the situation would start to change. Stocks could become collateral, funds could become collateral, U.S. Treasury bonds could become collateral, stablecoins could take on settlement functions, and smart contracts could execute financial rules automatically based on pre-set conditions. The various capabilities that are originally scattered across brokers, banks, fund companies, payment institutions, and on-chain financial agreements could potentially be established on a more unified asset and settlement network.

This is the "programmability" of the assets. It does not mean that all stocks can freely enter any on-chain agreements. Securities going on-chain are still subject to investor identity, transfer conditions, and legal jurisdiction constraints; some clearly defined rules can be translated into whitelists, limits, and freezing permissions. Code can help enforce rules, but the legality of the rules, who has the authority to modify them, and how to remedy errors still require legal and governance arrangements.

If this indeed develops to that stage, the change will not be as simple as "securities turning into tokens." In the past, many financial rules were written into contracts, executed by banks, brokers, custodians, and backend personnel; in the future, some of those rules may directly become financial infrastructure executed automatically by programs. What will be genuinely redesigned is not just the representation of assets, but also the way financial rules are implemented.

Stocks going on-chain does not mean everyone can anonymously trade U.S. stocks

This is the most easily misunderstood point when discussing securities tokenization, and I think it is particularly important to clarify it today.

Many Web3 users might naturally think: since stocks have turned into tokens on the blockchain, can I just open a crypto wallet, connect to a decentralized exchange, and buy Apple? Further, can a Chinese person, an American, an Iranian, or a Russian, as long as they have a wallet address, trade freely?

At least from the perspective of the regulatory framework currently being formed in the U.S., that is clearly not the case.

The SEC's "Innovative Exemption" emphasizes a permitted environment. Robinhood also requires users to provide identity information and complete appropriate investor assessments and risk tests before allowing them to trade stock tokens.

The reason is not complicated: "securities turning into tokens" and "the disappearance of securities law" are two completely different things.

This is a very important phrase to remember during this era of securities tokenization: code can change the form of assets, but it does not automatically change the legal attributes of the assets.

SEC Commissioner Hester Peirce has already stated it very straightforwardly: tokenized securities are still securities.

Therefore, many original requirements still exist, including customer identity verification, anti-money laundering, sanctions list screening, investor suitability, securities issuance rules, market manipulation regulation, insider trading regulation, tax reporting, and jurisdictional restrictions, among others.

So what might actually emerge in the future is not necessarily the completely permissionless decentralized finance everyone is familiar with today. It is more likely to be a kind of permissioned decentralized finance: it looks very Web3, using blockchain underneath, assets in wallets, trades completed via smart contracts, even using automated market makers, but wallets must complete identity verification, smart contracts themselves might have built-in whitelists, wallets from certain countries and regions may not be able to receive specific securities, and unverified wallets may also not be able to complete transfers between each other.

This might be the true "on-chain Wall Street" version in America.

Why is this issue more important than RWA itself?

In the past few years, when discussing RWA, one of the favorite phrases has been "bring real-world assets on-chain." U.S. Treasury bonds on-chain, funds on-chain, real estate on-chain, stocks on-chain—all sound like they belong to the same story. But I increasingly feel that merely packaging a real asset into a token and then trading it on a crypto exchange does not genuinely transform traditional finance.

The underlying stocks may still be purchased by traditional brokers, the assets still held by traditional custodians, and the shareholders' register still operating within the traditional securities system, with just an additional layer of a token circulating on the blockchain at the outermost level. In that sense, it adds a layer of crypto asset shell to traditional financial assets.

This is certainly not to say that such RWA lacks value. On the contrary, it can allow traditional financial assets to gain longer trading hours, broader global distribution capabilities, and also enable these assets to enter previously inaccessible on-chain collateral, lending, and trading scenarios. But if the core ledgers of the entire securities market, clearing systems, custodial systems, and shareholder registration systems do not change, then strictly speaking, it is more about connecting traditional financial products to blockchain rather than using blockchain to fundamentally transform traditional finance.

Therefore, I believe that the true focus of Nasdaq's series of actions this year is not that it has added a type of asset to the RWA market, but that the traditional financial market itself is beginning to consider adopting blockchain-based financial infrastructure. This year, Nasdaq is not just modifying its trading rules; it also announced the design of a stock tokenization framework centered on issuers, hoping to incorporate functions like proxy voting, corporate actions, and shareholder communications into the tokenization system. By September, Nasdaq announced plans to invest $100 million in Kraken's parent company, Payward, and clearly stated that the two parties will continue to cooperate to promote tokenized stocks, around-the-clock markets, and the connection between traditional financial systems and decentralized networks.

If we take these actions together, the question has shifted from "Does Wall Street want to study blockchain?" to a more fundamental question: what kind of technological architecture should the next-generation securities market operate on? If traditional securities themselves start to natively support tokenization, and if central securities custodians, clearing and settlement, shareholder registration, and corporate actions gradually connect to the blockchain, then the very clear boundaries that once existed between crypto finance and traditional finance will increasingly blur.

In the past, when we talked about RWA, the subtext was that there were two different financial systems in the world: one is the "real world," where stocks, bonds, funds, and real estate exist; the other is the "blockchain world," where Bitcoin, Ethereum, stablecoins, and various on-chain financial protocols reside. So-called RWA is trying to find a way to map the assets of the first world to the second world. But if one day stocks themselves are on-chain assets, funds themselves are on-chain assets, U.S. Treasury bonds are on-chain assets, and dollars are also circulating on-chain through stablecoins, then the concept of "real-world assets going on-chain" itself may gradually lose its meaning. Because at that point, on-chain and off-chain no longer exist as two parallel financial worlds; the blockchain itself has become part of the real financial world.

From this perspective, the so-called RWA today might just be a transitional concept in the process of migrating financial infrastructure.

Stocks, stablecoins, and AI, entering the same financial system

Pushing further in this direction, I think there will be a very interesting combination to observe: stock and other security assets, stablecoins, and AI systems may for the first time truly operate on the same set of financial infrastructure. Today, these three elements are still relatively disconnected, with stocks primarily existing in the broker and securities market system, stablecoins functioning mainly in the blockchain and crypto finance system, while AI is more focused on helping investors research companies, analyze data, and generate investment advice.

But as securities gradually go on-chain, the relationship among the three will change. Suppose in the future your wallet contains Nvidia stocks, U.S. Treasury bond funds, and USDC, and the AI system has been granted some operational authority, it could theoretically manage these assets according to pre-set rules. For instance, it could automatically adjust the money market fund positions when the cash ratio falls below a certain level; reduce exposure when stock positions exceed the risk threshold; and obtain stablecoins using U.S. Treasury or eligible securities as collateral when you need short-term liquidity, rather than selling off assets, transferring dollars from a broker to a bank, and then entering another financial platform.

In the past, completing such a series of operations required collaboration between multiple financial institutions, accounts, and databases. In the future, if the assets themselves already exist on-chain, part of the process might become a collaboration between a wallet, a set of smart contracts, and an AI system. At that point, the role of AI will also change: today when we talk about AI in investing, it's mostly still "AI helps you analyze stocks"; in the future, what may be truly important is not what AI tells you to buy, but whether AI can directly manage on-chain financial assets according to explicit rules after obtaining limited authorization.

In this scenario, AI can assist in decision-making and issue commands, smart contracts can execute according to conditions, blockchain can record asset status and transfers, while stablecoins provide a settlement tool. The prerequisite for their collaboration is that asset rights are recognized, the transaction pathways are permitted, and every step falls within user authorization.

What should be designed in advance is not to grant AI too much freedom, but rather to make the authorizations specific enough: how much money can be operated at most, which protocols can be called, how much slippage is allowed, under what circumstances operations must be halted, and how users can revoke permissions. A vague "agree to manage assets with AI" is not sufficient to address these issues.

If AI misidentifies risks, contracts are executed beyond authorization, or custodian interfaces malfunction, who will users hold accountable? Model service providers, wallet operators, strategy providers, and custodians must clearly define their obligations in the product structure and maintain records sufficient to restore the decision-making and execution processes. Moving assets onto the same chain does not automatically clarify responsibilities.

Business competition will also change accordingly. Whoever controls the user wallet entry, decides which services assets can call upon, and provides custody, liquidity, and compliance execution may capture corresponding service revenues. Existing institutions may not necessarily exit, but they will need to reprove the irreplaceable value they offer on this shorter, more automated business chain.

It is not the crypto world swallowing Wall Street, but rather two financial worlds beginning to merge

In discussions around securities tokenization, there are commonly two judgments: one believes it is merely changing the database, while the other believes exchanges, brokers, and custodians will be replaced. What I care more about is after each infrastructure migration, which services truly reduce costs, which institutions still bear necessary responsibilities, and which fees are merely habits left over from history.

Changes in financial infrastructure are rarely accomplished by completely overthrowing old systems. The transition from paper stocks to electronic ones did not make the stock system disappear; replacing trading floors with electronic order books did not eliminate securities regulation; after the rise of internet brokers, stock exchanges still remain core infrastructure in capital markets. But every migration of underlying technology changes the values and boundaries of different roles along the industry chain, and blockchain is likely to do the same.

This change is no different. Wallets may become new customer entry points, custodians need to address the connection between on-chain asset control and legal rights, and trading venues must provide reliable prices and liquidity. The names of institutions may not change, but the positions of competition may have already shifted.

Reality is presenting a mixed structure: traditional financial institutions absorb the technological capabilities of blockchain, while on-chain finance connects to identity verification, securities rights, and investor protection rules. Asset recording and operations can be more automated, but dispute resolution, responsibility, and institutional trust still require accountability.

Thus, evaluating how far along "Wall Street going on-chain" has progressed cannot merely hinge on counting how many tokens have been issued. It is more critical to examine whether investors' rights are clear, whether assets can be reliably delivered and redeemed, whether trading and settlement are more efficient, and whether there are clear paths of accountability and remedies after system failures.

When these issues begin to get resolved in practice, "moving Wall Street onto the blockchain" will transform from a market story into an infrastructure that investors and financial institutions can use. Today’s trading rule pilot programs, tokenized products, and on-chain settlement are specific ways to observe this change.

This migration has just begun.