- Nasdaq’s tokenisation strategy could create parallel trading systems, splitting liquidity across traditional and blockchain-based venues.
- TD Securities warns this may lead to pricing inconsistencies for the same stocks across different platforms.
- Growing adoption of tokenised equities, led by platforms like Kraken, signals broader structural changes in market infrastructure.
Nasdaq’s moves to integrate tokenisation into equity markets could split trading across traditional and blockchain-based systems, potentially reshaping how stocks are priced, TD Securities said. The firm warned this may create parallel venues where identical securities trade at different values.
Nasdaq and the New York Stock Exchange are incorporating tokenisation into alternative trading systems that operate alongside conventional exchanges. Nasdaq is progressing initiatives including enhanced settlement infrastructure, tokenised share issuance and access to offshore platforms like Kraken.
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Cross-Border Trading Complicates Oversight
This strategy could produce two coexisting market structures, one regulated within the US and another facilitated through offshore blockchain networks. Although tokenised shares would be backed by real equities, operating outside domestic regulatory frameworks may introduce differences.
The presence of multiple venues trading the same assets could fragment liquidity and make price alignment more difficult. TD Securities said this may reduce clarity for investors and redirect trading flows away from established exchanges.
Tokenised equities are gaining traction as part of a broader expansion in blockchain-based financial instruments. Kraken’s xStocks platform has exceeded US$25 billion (AU$35.25 billion) in total trading volume.
At the same time, traditional infrastructure is evolving to incorporate tokenisation within regulated environments, including near-instant settlement and extended trading hours.
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