Access and leverage drive tokenized equity demand
The guest argued that the primary demand for tokenized equities is driven by global retail access and leverage rather than institutional custody of the underlying assets.
The argument
Sethi pointed out that while spot tokenized equity wrappers are growing, the real volume is happening in synthetic perpetuals where users in emerging markets seek exposure to single-name US equities. He contrasted this fast-growing offshore retail demand with the slower, DTCC-regulated path required for US institutional adoption.
The thesis, stress-tested
✓ What validates it
- ✓Growth in daily trading volume of synthetic US equities on offshore platforms
- ✓Launch of onshore regulated tokenized equity products in Europe or the US
▸ Risks discussed
- ▸Regulatory actions by the SEC or international bodies against synthetic equity platforms
- ▸Counterparty risk in synthetic perpetual contracts
Hear it yourself
"What are you seeing there? Like, what are the trends? Why are people using things in that space, and what is driving that growth for people who are unfamiliar? Unfamiliar? Yeah. You know, I I think it comes down to basics and we kind of forget about it, which is you don't have access. Right? So if you think about where your assets may lie and how do you be able to get access to them and get access to capital and then to be able to borrow from them, A lot of the biggest markets where we've seen even stablecoin adoption, which is what we talk about a lot, but people forget where they"
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