NYSE tokenization partners warn synthetic stock tokens could mislead retail traders
Executives warn that synthetic stock tokens can mislead investors by lacking actual equity representation and exploiting regulatory gaps.Summary
Executives from Intercontinental Exchange (ICE), OKX, and Securitize have issued warnings regarding the risks posed by synthetic tokenized stocks. During a panel at Consensus Miami, leaders highlighted that many offshore synthetic tokens do not actually represent the underlying equity and may use company names without authorization, creating significant risks for retail traders.
Securitize CEO Carlos Domingo noted that these products often engage in regulatory arbitrage, operating from permissive jurisdictions while still reaching major markets. He pointed out that during corporate actions like stock splits, price discrepancies between tokenized versions and actual shares can be extreme. In contrast, ICE is developing a regulated platform for tokenized U.S. equities that will use a pre-funded model trading against stablecoins to ensure a structured and evaluable environment for regulators and investors.
The SEC has also increased scrutiny on the distinction between true tokenized ownership and synthetic exposure, emphasizing that issuer approval is necessary for legitimate tokenized stock ownership.
(Source：CoinDesk)