Asset Tokenization Platform Backed Finance Launches xStocks Product

Recently, a Swiss compliant asset tokenization platform launched a new product named xStocks. This is a series of tokens backed 1:1 by actual stocks, with the underlying assets held by regulated third-party custodians. These tokens are issued under the SPL standard on the Solana blockchain, supporting round-the-clock trading and on-chain instant settlement, breaking the time and space limitations of traditional stock markets. According to compliance requirements, xStocks is currently only open to non-US users. Subsequently, several major trading platforms have also successively launched this product.

Team Background

According to reports, the three co-founders of the platform all have prior experience working in blockchain projects. Inspired by the widespread application of stablecoins in 2021, they founded this company focused on bringing traditional assets into the blockchain system in a compliant manner. From 2021 to 2022, the team completed project feasibility verification and seed round financing, establishing partnerships with custodian banks and brokerages, and the relevant product prospectus received regulatory approval from the EU. After the launch of the first batch of products in 2023, the cumulative issuance scale exceeded $50 million. In April 2024, the company completed a $9.5 million Series A financing.

Product System and On-Chain Deployment

The platform currently provides on-chain tokenization securities services covering global blue-chip stocks, index funds, and short-term bonds through its two major product lines, xStocks and bTokens. All tokens are backed by 1:1 physical assets and have ISIN numbers approved for EU compliance. Products have been issued on multiple mainstream public chains and integrated with various DeFi protocols, supporting on-chain strategy deployments such as lending, market making, and arbitrage.

An analyst pointed out that the xStocks token is essentially a debt structure, not an equity token. This structure allows the token to be transferred freely on-chain like a stablecoin, avoiding some of the complex procedures involved in equity transfer. However, the current model mainly provides users with exposure to US stocks, and further institutionalization may require additional issuance structures and plans.

Trading Experience: Insufficient Liquidity and Participation Barriers

Despite being supported by mainstream trading platforms, the actual trading activity of xStocks is still highly concentrated on a few specific assets. In the early stages of its launch, on-chain trading volume and user numbers showed significant growth, but on-chain trading for most assets is extremely limited, and liquidity issues are widespread. In addition to on-chain trading, xStocks can also facilitate trading through internal matching on the exchange, but it still faces liquidity shortages. Overall, the trading experience remains significantly inferior compared to traditional Contract for Difference platforms.

Target Audience and Structural Advantages

The xStocks model primarily serves non-US users who find it difficult to access US stocks through traditional brokers, especially crypto-native users. Its advantages include: support for stablecoin payments and small transactions, no need for a US stock account, 24/7 on-chain matching and settlement, real asset custody, and compliance with EU regulations.

Expansion Path: Derivatives and Tokenization of Unlisted Equity

In light of the liquidity bottleneck in the spot market, the industry has begun to focus on more trading-oriented derivatives paths, particularly perpetual contracts for stocks. These products do not require actual stock delivery and can rely on oracle prices and funding rate mechanisms to achieve purely on-chain trading. The technical path is mature and suitable for priority deployment on decentralized platforms.

Another direction worth paying attention to is the tokenization of equity in unlisted companies. Issuing transferable equity tokens on-chain, combined with mechanisms such as DAO governance, contract lock-up, and investor qualification review, is expected to achieve an efficient and transparent early equity circulation structure. However, this path still faces challenges such as regulatory uncertainty and complex issuance structures, and in the short term, it is more likely to exist in a pilot or gray compliance form.

Conclusion

xStocks provides a practical path for compliant asset tokenization, with its on-chain structure, cross-chain deployment, and DeFi integration capabilities demonstrating strong product design capabilities. However, the liquidity of the spot mode is limited, and the user expansion ability is insufficient, making it difficult to independently support the growth curve of the tokenized stock market. In the future, breakthroughs around the combination of perpetual derivatives and early equity tokenization may become a key point in driving the on-chain securities market from "tool-type products" to "trading-type assets."