A Year of Tokenized US Stocks: Why Nobody Buys Spot, but Leverage Is Booming

On Sept. 17, the SEC issued a five-year pass for tokenized US stocks, allowing them to be traded via liquidity pools on public blockchains.

Supporting moves are also accelerating. The ten stock tokens Coinbase launched on the Base chain in August have surpassed $1 billion in cumulative volume; on Sept. 23, the NYSE and Blockchain.com signed a memorandum of understanding to bring tokenized US stocks to 44 million crypto accounts.

Regulators have given the green light, products are live, and the table is set.

But two sets of samples in a Sept. 18 report by TD Cowen analyst Reid Noch poured cold water on the enthusiasm. Figure's stock has both a traditional listed version and a tokenized version; over a 24-hour observation period, 99.9% of volume went through traditional stocks, while the tokenized version accounted for only 0.1%. In Binance's Nvidia products, perpetual contracts made up 96% of volume, while spot tokens were just 4%.

Out of every thousand dollars, only one dollar bought on-chain stocks.

Noch's conclusion is blunt: US investors already have efficient channels to buy stocks, and tokenization platforms must offer clear benefits to justify enduring illiquidity. He spoke with dozens of issuers, and apart from Figure, which is itself a crypto-native business, almost no one was interested.

Money did come. But from Binance's volume to Aave's lending pools, few are buying stocks.

So where did it go?

01 Bulls Would Rather Pay 18% Annualized Than Buy Stocks

The first destination is US stock perpetual contracts.

Binance's stock perpetual volume in August was $342.9 billion. Over the same period, Token Terminal counted $20.9 billion in 30-day decentralized exchange volume for tokenized stocks across the market. Leverage volume was 16 times spot. In January, Binance's stock-related perpetual volume was only $410 million.

Open interest is also rising. Kairos Research counted $2.14 billion in one-sided open interest for Binance US stock perpetuals on Aug. 26; by Sept. 25, Ethena's announcement put that figure above $2.9 billion.

Why would traders rather open contracts than buy spot? Look at the funding rate. The funding rate is the periodic payment from longs to shorts in perpetual contracts; the more crowded the longs, the higher the rate. Ethena calculated that from May 20 to Aug. 11, the average annualized funding rate for Binance US stock perpetuals was 17.5%, positive on 97% of days. Over the same period, Bitcoin perpetuals averaged only 2.2% annualized.

In other words, those going long Nvidia perpetuals are willing to pay nearly 18% extra per year in exchange for 24-hour trading, leverage, and not actually holding the stock. By late August, Kairos-tracked rates on Binance's eligible list fell to around 7%, with two assets turning negative—enthusiasm is fading.

This path is still widening. On Sept. 18, Coinbase also applied to the CFTC for single-stock perpetuals for US users, planning to cover 50 to 60 stocks and ETFs including Apple and Nvidia.

02 Aave Lends on Weekends, but Stock Prices Freeze on Friday

The second destination is pledging stock tokens to borrow money.

On Sept. 25, Aave V4 opened a market on the Base chain: seven Coinbase stock tokens—including Nvidia, Apple, and Tesla—can be used as collateral, borrowing only USDC, for qualified users outside the US. The USDC borrowing cap is $21 million, maximum collateralization ratio is 79%, and liquidator rewards are up to 5.5%.

The problem is timing. US stocks close at 4 p.m. Friday, and Chainlink's price feed holds the last price from 8 p.m. ET Friday until 8 p.m. Sunday. During those 48 hours, deposits, borrowing, and liquidations continue as usual, but everyone sees Friday's stale prices.

Imagine a scenario. After Friday's close, a stock gets bad news and gaps down 10% at Monday's open. A position fully borrowed at 79% collateralization becomes liquidatable as soon as the price feed updates at 8 p.m. Sunday.

Liquidators need to sell the tokens, but in the Sept. 17 snapshot, the 2% price impact depth for these seven tokens was only $270,000 to $1.08 million. If the gap is 20%, the 5.5% reward won't cover the gap plus slippage, and the shortfall falls on USDC lenders.

For now, this is a window, not bad debt. On Sept. 28, Aave's frontend showed this market had $6.2352 million USDC deposited and $425,200 borrowed, a utilization rate of 6.8%, with stock token collateral totaling about $1.91 million. The scale is still small, but the gate is open.

03 USDe's Rice Bowl Swapped for Retail Stock Leverage Enthusiasm

The third destination is the yield engine of stablecoins.

On the same day, Sept. 25, Ethena announced it was expanding USDe's basis strategy to Binance: holding Binance's stock tokens (bStocks) as spot while shorting US stock perpetuals on the same exchange, earning the funding rate paid by longs.

The job change was forced. USDe's past yield came from crypto perpetual funding rates; Bitcoin perpetuals' figure dropped from 11% annualized in 2024 to 2.2% in the first eight months of this year. USDe's size shrank accordingly, from a peak of about $14.8 billion in October 2025 to about $4.9 billion on Sept. 25.

There isn't much to eat. Kairos Research, which builds frameworks for Ethena's risk committee, set thresholds based on open interest and funding rate history; of Binance's 67 pairs, only 17 passed, OKX had 3, and Bybit and Kraken had none.

Looking at this chain, there are three loose points. USDe holders' yield now depends on retail stock traders' enthusiasm for going long; the rate fell from about 18% in late July to about 7% in late August, with two assets already negative.

The counterparty is only Binance. The disposal rights of bStocks issuer BTech over the underlying stocks are to be constrained by a side letter still under negotiation; Kairos recommended signing before approval, and public reports do not say whether it was signed.

04 Leverage Seekers Don't Want Stocks, Backstops Didn't Buy Stocks

Putting the three destinations together, the role of spot tokens becomes clear.

The total value of tokenized stocks from major issuers across the market has just passed $2.3 billion. Coinbase's ten tokens with over $1 billion in volume have combined USDC pools on Aerodrome of $12.97 million. Their use is as hedging inventory for perpetuals, collateral in Aave, and spot in Ethena's strategy.

When they themselves are traded as stocks, problems arise.

On the night of Sept. 3, seven hours after the US market close, Robinhood's AMC stock token on Uniswap surged from $2.55 to $23.16 in one hour—nine times the NYSE closing price—then fell back to $3.26 within the same hour. That hour saw $10.5 million in pool volume, and the issuer's authorized participant neither minted nor burned.

The premium lasted through the weekend. IOSG researcher Mario Chow counted that in the three days after the close, the issuance agent expanded token supply from 152,100 to about 2,895,800, a 19-fold increase.

The issuance agent is estimated to have bought about $7.6 million worth of AMC stock to push the price back down. Tram Doman of Bullish wrote on CoinDesk: when the market is closed, there is no borrow mechanism, only one authorized participant can redeem, and no matter how sufficient the collateral, the two markets still price independently.

AMC CEO Adam Aron demanded on X on Sept. 4 that Robinhood stop trading, calling it a "quasi-fake market created on the island of Jersey." Robinhood Chief Legal Officer Dan Gallagher's response: we know a thing or two about US securities law.

Look at the people on both sides. Those opening US stock perpetuals don't need stocks. Those depositing USDC into Aave and those holding USDe for yield haven't bought a single share, yet Monday's gap losses and negative funding rate losses ultimately fall on them.

Regulators provided a stock channel, but the market used it to pave a leverage road.

On Sept. 29, Robinhood will hold a summit in Houston; Vlad Tenev said "it's been too long since the last product launch," and Morgan Stanley expects this event may unveil perpetual contracts for US users.

A year ago, the slogan of tokenized US stocks was to let the world buy Apple and Nvidia anytime.

What went on-chain wasn't stocks—it was leverage.