In the market outlook from the day before yesterday, I mentioned: "US stocks on-chain is a narrative I am quite optimistic about."
Today, I will elaborate on my thoughts.
I refocused on this narrative domain because of @BackedFi. Similar things had appeared in the market before, but they ultimately fell through due to regulatory issues. After Trump took office, a series of regulatory policy changes made US stocks on-chain feasible again.
The core reason for being optimistic about the US stocks on-chain narrative is simple
Crypto market hype is nothing more than stories and models. AI, AI Agents, and RWA are stories, while DeFi, GameFi, and mining machines are (Ponzi) models. Stories are about mindshare, which means telling narratives that can attract market buying. Web2 Attention stories are the most numerous, such as AI and metaverse. As for models, they are basically Ponzi schemes. Essentially, they are about the older generation exploiting the younger one.
US stocks on-chain belongs to the former category. In my personal opinion, this is a narrative that can make a market willingly buy in - which is why I am optimistic about this narrative. Moreover, this narrative will inevitably integrate DeFi and RWA during its development, bringing incremental growth to these older narratives.
In Mint Ventures @xuxiaopengmint's "WEB3 MINT TO BE" column, Teacher Min summarized the benefits of US stocks on-chain as follows:
1. Improved Financial Efficiency: Traditional financial clearing systems are inefficient, while blockchain can significantly improve fund settlement speed, reduce costs, and enable 24/7 trading.
2. New "Empowerment" for Users: Tokenized stocks are not just equity certificates but can also have usage functions (such as fee deduction, staking participation, service exchange, etc.).
3. Breaking Territorial Regulatory Restrictions: Tokenized stocks can circulate globally, providing a larger capital pool for US stocks.
4. Enhanced DeFi Integration: Stock tokens, as new tradable assets, are naturally compatible with DeFi infrastructure (DEX, lending protocols, etc.).
Of course, when this narrative grows, it will inevitably attract regulatory attention. Ultimately, it comes down to two words: "compliance". The current core issue is regulatory uncertainty.
Everything else is irrelevant to the end goal.
Currently, for Crypto, there are no obstacles except for regulation, including infrastructure like DEX, collateralized lending, cross-chain, etc., which are basically readily available.
For example, @injective now supports futures trading for US stock indices, NVIDIA, McDonald's, and Tesla. These trades occur on its chain-based exchange Helix (Injective is not truly US stocks on-chain, but supports futures trading of US stock-related tickers).
Its core product architecture is iAssets. On the trading side, users trade with each other and with market makers using an order book. On the DeFi side, thanks to the programmable attributes of iAssets, it can be used in scenarios like lending collateral, yield strategies, leveraged positions, structured products, re-collateralization, and more.
In simple terms, iAssets transform static RWA assets into dynamic assets usable in DeFi.
At present, Injective doesn't need to worry too much about regulation, but it is indeed laying out the US stocks on-chain narrative. This layout might become a growth point for $INJ in the future.
Backed, on the other hand, is on Base, backed by the big tree of Coinbase (Coinbase Ventures has invested), and is actually putting US stock assets on-chain. For instance, this month, Backed launched the tokenized Coinbase stock wbCOIN on Base. It directly used Aerodrome as the liquidity exchange venue for wbCOIN. The assets it issues are fully collateralized 1:1 with real-world assets.
It faces higher regulatory risks (it uses the European MiFID II framework and Swiss DLT regulations to achieve permissionless tokenized stocks, so it is compliant in Europe at least).
My attitude is to participate if possible (become an LP), firstly to get in before it becomes competitive, and secondly for potential future airdrops. Perhaps after US regulations become clear, its native protocol token listing on Coinbase is not impossible. But this belongs to "vague predictions", so funds invested should not be too much - one can do a small long position.
