Coinbase is looking to expand beyond crypto trading by offering tokenized versions of traditional stocks.
The crypto exchange has confirmed its seeking approval from the U.S. Securities and Exchange Commission (SEC) to allow customers to trade equities on the blockchain, a move that, if approved, could open up a new avenue for both retail and institutional investors.
Turning stocks Into tokens
According to Coinbase’s Chief Legal Officer Paul Grewal, the platform is prioritizing the launch of tokenized equities. These are essentially digital representations of traditional company shares, designed to be traded like cryptocurrencies.
While the concept isn’t new, its presence in the U.S. has been limited due to regulatory hurdles.
To proceed, Coinbase would need the SEC to issue either a “no action letter” or exemptive relief, effectively giving the green light to launch the product without facing enforcement.
Grewal didn’t confirm whether Coinbase has already submitted such a request, but stressed that regulatory clarity is key to moving forward. Without it, he noted, confidence among potential participants remains low, especially among institutions considering blockchain-based financial products.
Meanwhile, other crypto firms have begun exploring similar territory.
Rival exchange Kraken, for instance, recently announced its xStocks product, tokenized U.S. equities that will be available in select markets outside the U.S. Unlike Coinbase, however, Kraken is not currently pursuing a domestic offering for these products.
Regulatory winds may be shifting
Coinbase’s push comes amid a broader change in crypto regulatory tone. Under the current Trump administration, several cases brought by the SEC against major crypto firms, including Coinbase itself, have been paused or dropped altogether.
A crypto task force has also been established to draft updated digital asset rules, indicating a more open approach to the industry.
Still, any offering of tokenized equities in the U.S. will require navigating SEC requirements around broker-dealer registration, something Coinbase currently lacks.
Grewal emphasized that approval from the SEC would represent a meaningful shift, possibly setting a precedent for future hybrid platforms that aim to bridge traditional finance and blockchain.
