Tokenized equity still in regulatory grey zone — Attorneys

Key Points

1. Tokenized stocks and private equity face legal challenges as they operate in a regulatory grey zone, lacking clear legal frameworks.

2. Investors should understand the fundamental attributes of tokenized equity instruments, including dividend streams, profit-sharing arrangements, or capital appreciation.

3. Robinhood's offering of OpenAI and SpaceX 'private equity' tokens in Europe caused confusion, highlighting the need for clearer regulatory guidelines.

4. Tokenized stock trading is already available on crypto exchanges like Kraken and Bybit, with over 60 publicly listed companies accessible.

5. The SEC, under chairman Paul Atkins, is reportedly receptive to industry requests for tokenized financial assets, recognizing their potential to enhance market efficiency.