Sebastian Pedro Bea, OLY
ReserveOne, President/CIO 

1. The ‘tokenization of everything’ has been coming for… a while? The brave brothers at Blockchain Capital, Brad and Bart, launched the first crypto VC fund in 2013, and were one of the first to tokenize a fund in 2017. The ticker was BCAP, now also the name of their firm, and the token is ERC-20 (a token standard on Ethereum). That token was eventually moved to Securitize, which was founded in November 2017. Securitize is due to go public soon with the backing of heavyweights like BlackRock. An ‘overnight success,’ after nine hard years of work (congrats to Carlos and team).
   
   

2. In 2017/2018, the future was bright! Security Token Offerings (STOs) continued in 2018, including tZERO’s STO offering of +$100M. A few years later, ARCA launched ArCoin in 2020, a digital security token that represented shares in 1940 act fund, the first of its kind. Similarly, INX listed the first ever SEC registered digital security, the INX token, in July 2021.
   
   

3. “Wait, I don’t recall these!?” You're not alone. You know who was alone? The issuers of these tokenized products five to eight years ago. There was no durable market and thus, no liquidity. The hardest thing in the world to make is a market. Anyone can create a product, but to create ongoing demand from willing participants to regularly exchange a product for value is hard… as the tokenization industry has learned again and again. You can’t just tokenize something and expect a market to appear.
   
   

4. Negative selection for tokenized paper hasn’t helped either. My favorite example? A tokenization of Brazilian consumer loans without collateral that I once due diligenced. The loans had an average size of $25. I asked the platform how recovery worked in default. The tokenization platform said, “oh, like any other default process. We would go after the borrower.” For $25? Exactly. If there was a reason this product was tokenized, I suspect it wasn’t a good one.
   
   

5. After earlier frustrations, will recent tokenized products break through? Maybe! Franklin (BENJI) and BlackRock (BUIDL) are tokenized money funds worth watching. BENGI has approx. $900M of AUM, and BUIDL is just under $2B. These funds get a lot of airtime, per unit of base fee. This focus is warranted because their underlying assets (T-bills) are critical collateral for trading. There’s a world where these funds grow dramatically if tokenized MMFs slide in as that collateral standard. BUIDL is finding itself in new and exciting places, like Binance, as eligible collateral. I didn’t have that on my 2025 bingo card either.
   
   

6. Also of interest: Yields from Figure (ticker YLDS). It is the first interest-bearing “stablecoin” that is registered with the SEC, can be moved peer to peer, and hold commercial paper, CDs, repos, T-bills, and municipal bonds. It’s not GENIUS-compliant as such… but is more interesting perhaps? There’s a fight over stablecoin yield (I mean, rewards) in DC… meanwhile there is already a yielding stablecoin registered with the SEC, and it has about $375M these days.
   
   

7. Tokenized stocks are finally taking off…offshore. In July 2025 (Kraken) and September 2025 (ONDO) these platforms launched tokenized stock platforms in offshore markets (non-US). Collectively, these platforms have gone from 0 to nearly $700M of total value locked (TVL; essentially AUM) in 6 months.
   
   

8. These platforms are “wrapped tokenizations,” not natively digital equity. Generally, this means offshore private funds that own US stocks via regulated and segregated entities (good). Offshore investors comply with AML/KYC to mint tokens for the underlying stocks. For NVDA for example: at Kraken xStocks it is “NVDAx,” and for ONDO GM it is “NVDAon.” These tokens operate outside US regulations and are free to transfer wallet to wallet and engage with DeFi.
   
   

9. Arguably these products are better and worse. Critics will counter that these wrapped tokenization models do not have fungibility (at least yet). It is either difficult or impossible to go from xNVDA or NVDAon to US NVDA on the DTC book entry ledger. Also, these wrapped tokenizations can have higher cost and inferior ownership rights. And yet… the tokens are taking off.
   
   

10. We believe Kraken and ONDO should be congratulated for their innovation. We also believe their momentum is a signal for the US Market to pick up the pace. We believe Kraken and ONDO are doing more than just fulfilling a niche market need for offshore investors with a ton of USDT. Their offerings bring the potential of DeFi for US stocks (24/7 token trading, lend/borrow, etc.). They are tapping into an offshore need for US product, one that we have seen before… Eurodollars come to mind, for example. Could these tokenized stock platforms pull liquidity from the US stock market? Probably not, but either way, that’s a good question! And it’s a signal for the US markets to get moving. Innovation waits for no one.

Sebastian Pedro Bea, OLY 
ReserveOne, President/CIO 

Sources: 

https://www.prnewswire.com/news-releases/blockchain-capital-to-raise-its-third-fund-via-a-digital-token-offering-300424587.html 

https://en.wikipedia.org/wiki/Securitize,_Inc. 

https://investors.beyond.com/news-events/press-releases/news-details/2018/tZERO-Issues-Preferred-tZERO-Security-Tokens-10-16-2018/default.aspx 

https://www.ar.ca/blog/arca-labs-launching-the-arca-u.s.-treasury-fund-and-arcoin 

https://www.newswire.ca/news-releases/inx-makes-history-with-the-listing-of-the-world-s-first-sec-registered-digital-security-collapses-trading-fees-872561674.html 

https://www.prnewswire.com/news-releases/blackrocks-buidl-tokenized-by-securitize-now-accepted-as-collateral-for-trading-on-binance-and-launches-on-bnb-chain-302613374.html 

https://app.rwa.xyz/assets/BENJI 

https://app.rwa.xyz/assets/BUIDL 

https://defillama.com/stablecoin/ylds 

https://fortune.com/crypto/2025/02/20/figure-markets-sec-approved-stablecoin-ylds-mike-cagney/ 

https://www.kraken.com/xstocks 

https://ondo.finance/blog/global-markets-live-on-solana 

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