TD Securities, a major Canadian investment bank with operations across North America, says tokenization may be approaching an institutional turning point following the New York Stock Exchange’s push into tokenized equities.
In recent commentary, TD Securities Reid Noch, vice president for electronic trading, said tokenization is beginning to carry real implications for market structure, pointing to the NYSE’s proposed tokenized equities alternative trading system (ATS) as a key development.
The planned platform would enable 24-hour trading and near-instant settlement of tokenized stocks and exchange-traded funds (ETFs), subject to regulatory approval.
Rather than creating a parallel crypto-native marketplace, the venue is designed to operate within existing US market rules while leveraging blockchain-based settlement infrastructure.
Noch described the structure as closer to a “2.0” market shift, where custody and settlement would remain anchored to the Depository Trust & Clearing Corporation (DTCC), while trading would comply with National Best Bid and Offer (NBBO) requirements. This means prices must reflect the best available bid and offer across U.S. exchanges to prevent fragmented liquidity.
Although Noch said early activity is expected to be retail-driven, the broader implications extend well beyond individual traders.
TD Securities’ institutional focus suggests the company sees potential impact on core market plumbing, including trading hours, collateral management, settlement cycles and liquidity, areas that shape how large financial institutions operate.
Tokenized equities gain institutional traction
Tokenization accelerated in 2024, led primarily by private credit and U.S. Treasury products, which have accounted for the bulk of onchain real-world asset (RWA) issuance, according to industry data.
Despite broader crypto market volatility, capital inflows into tokenized assets have continued, suggesting sustained institutional interest in blockchain-based settlement and ownership models.
More recently, tokenized equities have begun gaining traction. Kraken’s xStocks platform has emerged as one of the more visible entrants, reporting more than $25 billion in cumulative trading volume since launching last year.
Although tokenized equities remain a small fraction of global stock market activity, their growth reflects a broader shift toward bringing traditional financial instruments onchain within regulated frameworks.
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