NYSE tokenization partners warn synthetic stock tokens could mislead retail traders

FinanceShareShare this articleCopy linkX iconX (Twitter)LinkedInFacebookEmailNYSE tokenization partners warn synthetic stock tokens could mislead retail traders

Offshore synthetic tokens may not represent the underlying equity, use company names without approval, and exploit regulatory arbitrage.

By Francisco Rodrigues, AI Boost|Edited by Jamie Crawley May 6, 2026, 2:08 p.m. 2 min readMake preferred on

What to know:

• Executives from ICE, OKX, and Securitize warn that synthetic tokenized stocks create risks for the market and retail traders.
• Offshore synthetic tokens may not represent the underlying equity, use company names without approval, and exploit regulatory arbitrage.
• NYSE (owned by ICE) is building a regulated platform for tokenized U.S. equities, starting with pre-funded tokens for stability.

Executives from Intercontinental Exchange (ICE), OKX and Securitize warned that synthetic tokenized stocks are creating market and retail risks, as ICE moves ahead with a regulated platform for tokenized U.S. equities.

Michael Blaugrund, who works on strategic initiatives at ICE, the owner of the New York Stock Exchange (NYSE), said during a panel at Consensus Miami that NYSE’s first version will start with pre-funded tokenized equities trading against stablecoins.

That model is “not the sexiest way” to build a market, Blaugrund said, but gives issuers, investors and regulators a structure they can evaluate before more complex features such as leverage or self-custody.

Carlos Domingo, founder and CEO of Securitize, said offshore tokenized stock products are taking the opposite approach. Some use public-company names without issuer approval and do not represent the underlying equity, he said.

“For some stocks there’s like five different tokenized versions,” Domingo said, citing Coinbase as an example. “None of them actually represent equity on Coinbase.”

The risk is clearest during corporate actions, Domingo said, as he saw one tokenized stock wrapper trade at prices that differed by five times across markets after a stock split.

Haider Rafique, OKX’s global managing partner officer, noted the exchange has not launched synthetic tokenized securities and does not plan to move before regulated supply is in place.

“We’re not selling a promissory note,” Rafique said. “We’re actually selling the underlying asset.”

The warning follows broader scrutiny of stock tokens and private-market exposure. OpenAI said last year that Robinhood’s OpenAI stock tokens did not represent OpenAI equity and were not approved by the company, while Robinhood later said the tokens were backed by a special purpose vehicle.

Domingo said the issue is regulatory arbitrage. Offshore issuers can create wrappers in permissive jurisdictions and claim they are not targeting the U.S. or Europe, he said. Permissionless tokens can still flow back into those markets.

The SEC has also sharpened its focus on the distinction between true tokenized ownership and synthetic exposure, saying issuer approval is required for true tokenized stock ownership.

Blaugrund compared the shift to tokenized securities with the move from floor trading to electronic markets.

“It’s now ‘when,’ not ‘if,’” Blaugrund said.

NYSE said in January it was developing a platform for 24/7 trading and onchain settlement of tokenized U.S.-listed stocks and ETFs, pending regulatory approval. The platform is expected to support fractional trading, immediate settlement and dollar-denominated orders.

ICE later struck a strategic partnership with OKX, giving the crypto exchange’s customers access to ICE futures and NYSE tokenized equities, also subject to approvals.

NYSE also tapped Securitize to help build the tokenized stock platform, with the firm acting as a digital transfer agent for issuer-backed tokenized securities.

Real World Assets TokenizationConsensus Miami 2026AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.

More For You

OpenTrade raises $17 million to connect stablecoins to real-world assets

By Olivier Acuna|Edited by Jamie Crawley1 hour ago

The a16z-backed stablecoin yield and RWA lending platform’s funding round was led by Mercury Fund and Notion Capital.

What to know:

• Stablecoin infrastructure platform OpenTrade raised $17 million in a round led by Mercury Fund and Notion Capital, bringing its total funding to more than $30 million.
• The London-based, firm plans to use the capital to expand both its permissioned and permissionless infrastructure and to grow its asset management and trading...

Read full storyLatest Crypto News

CoinDesk 20 performance update: Index jumps 2.5%, continuing higher

54 minutes ago

OpenTrade raises $17 million to connect stablecoins to real-world assets

1 hour ago

Memecoin trades carry rare 'seven-leg' parlay odds, BONK's Nom says at Consensus

1 hour ago

Colombia wants to mine bitcoin with surplus renewable energy

1 hour ago

Zcash bets turn into second-largest liquidations behind bitcoin as ZEC rockets 30%

1 hour ago

Morgan Stanley brings crypto trading with lower fees than rivals

1 hour agoTop Stories

Bullish’s Equiniti deal could remake it into a tokenization powerhouse, Clear Street says

1 hour ago

Bitcoin moves above $82,000 while ZEC and DASH post double-digit rallies

3 hours ago

Crypto derivatives have converged with Wall Street. Equity perps could soon prove it.

6 hours ago

Ripple CEO Brad Garlinghouse says Clarity better than chaos as Senate hits key moment

21 hours ago

Michael Saylor's Strategy signals potential bitcoin sale to fund dividends obligations

14 hours ago

Figure targets Fannie Mae and Freddie Mac in mortgage push, citing massive cost cuts for borrowers

21 hours ago