Coinbase says it will launch 1:1 backed tokenized US stocks onchain. The move revives a concept that has drawn SEC scrutiny. The 3 PM event will test whether this time is different.
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Coinbase said it would launch what it calls the first "true" tokenized stocks, claiming 1:1 backing by actual shares of U.S. companies. The announcement formed part of a "System Update" livestream scheduled for 3 PM ET today. The company said the tokens would trade onchain, settle instantly, and pay dividends automatically, with no derivatives or IOUs.
The concept of tokenized equities has a spotty history. Binance offered stock tokens in 2021, then pulled them after the SEC and European regulators raised objections. FTX listed tokenized stocks ahead of its collapse; those tokens are now worthless. Coinbase's pitch differs in promising direct onchain ownership rather than a depositary receipt structure. Whether the market accepts that difference depends on the legal packaging and the custody arrangements.
The SEC has not provided a clear path for tokenized securities. The agency's enforcement arm has targeted crypto products that resemble stocks or bonds, arguing they fall under securities law. Coinbase holds a broker-dealer license and is registered as an alternative trading system, which could give it a compliance advantage. The SEC's investigation into Coinbase's staking product is ongoing. The agency remains willing to litigate novel crypto products.
The timing of the announcement follows a difficult stretch for the stock. Coinbase shares trade at $168, more than 60% below the 52-week high of $440. The last earnings report missed analyst estimates on revenue and user growth. The stock has also tracked Bitcoin's price swings, adding volatility. A product launch that generates new trading volume and fee income would address two of the company's weaknesses at once: user engagement and revenue diversification.
The System Update event at 3 PM will provide the first details on specific issuers, custody partners, and eligible assets. If Coinbase announces relationships with a transfer agent or a registered custodian, the offering gains a structural advantage over earlier experiments. If the presentation stays at the level of marketing language without operational specifics, the market may treat it as a hype event.
The broader question is demand. Tokenized stocks already exist in non-US markets through brokers like eToro and through depositary receipt structures. The real innovation would be removing the middleman from settlement, not from trading. Onchain settlement eliminates T+2 delays but still requires offchain reconciliation with the actual share register. That is a technical challenge that earlier projects failed to solve.
For traders watching the event, the outcome is binary. A credible launch with named partners would show Coinbase can execute beyond its core crypto exchange business. A vague announcement would reinforce the narrative that the company is struggling for relevance after the earnings miss. The stock's reaction in the hour after the event will tell which camp the market believes.
Coinbase will livestream the event at 3 PM ET. The company said additional technical details would be published after the presentation.
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