What Are Tokenized Stocks?
Tokenized stocks are a form of digital asset that is created and stored on the blockchain. They represent ownership in a company, just like traditional stocks do, but they are not issued by any government or financial institution. Instead, tokenized stocks are issued directly from the issuer to investors through an Initial Coin Offering (ICO). Tokenized stock tokens can be traded on exchanges and other platforms for cryptocurrency or fiat currency.
The main benefit of tokenizing stocks is that it allows companies to raise capital quickly without having to go through lengthy regulatory processes. It also provides greater liquidity than traditional stock markets since there is no need for brokers or middlemen when trading these assets. Additionally, tokenization makes it easier for small investors to get involved with investing in startups as well as established companies since the cost of entry is much lower than buying shares on a public exchange. Finally, because all transactions occur over the blockchain, they are secure and immutable which helps protect against fraud and manipulation.