Tokenized equities face legal challenges and may not grant ownership of actual shares.

Tokenized stocks and private equity face legal challenges as they fall in a gray area, lacking the same rights as traditional assets. Investors should understand the attributes of tokenized equity instruments, which may not grant ownership of actual shares. Robinhood’s offering of “private equity” tokens caused confusion, prompting calls for clear regulations.

Various platforms, including Kraken and Bybit, are actively exploring or offering tokenized stock trading services. Centrifuge partners with S&P Dow Jones Indices to tokenize the S&P 500 index. Coinbase seeks SEC approval to offer tokenized stock trading. SEC chairman Paul Atkins supports tokenization as an innovation for the marketplace.

Read more at Cointelegraph: Why Tokenized equities are not the same as holding legacy equities