TD Cowen Sees Limited Demand for Tokenized Stocks Despite SEC Rule

Investment bank TD Cowen has expressed skepticism about near-term demand for tokenized stocks in the U.S., despite new Securities and Exchange Commission rules designed to facilitate their trading.

The SEC’s recently announced Innovation Exemption creates a five-year framework for qualifying venues to operate automated market maker pools for tokenized securities without full exchange registration. This regulatory move follows the failure of the CLARITY Act to advance in Congress.

TD Cowen analysts argue that U.S. investors already have straightforward access to traditional stock markets, reducing the immediate need for tokenized versions. Furthermore, they note that corporate issuers have shown little interest in pursuing tokenization of their own equity.

The bank’s analysis suggests that crypto-based perpetual futures contracts, which offer synthetic exposure to stocks, remain a far more popular product among traders. Trading volumes for these perpetuals significantly outpace those for existing tokenized spot stock offerings.