Balchunas says tokenized stocks unlikely to disrupt ETFs as SEC gears up for rule change

**Tokenized Stocks Won't Disrupt ETF Market Despite SEC Rule Changes, Bloomberg Analyst Says**

Bloomberg's senior ETF analyst Eric Balchunas believes tokenized stocks pose minimal threat to traditional exchange-traded funds, even as the SEC prepares potential regulatory changes allowing major company shares like Tesla and Nvidia to trade on cryptocurrency exchanges. This development represents a significant intersection between traditional finance and the growing DeFi ecosystem.

The potential SEC rule modification could enable blockchain-based trading of conventional stocks, bridging legacy markets with cryptocurrency platforms. However, Balchunas suggests this innovation won't significantly impact the $7 trillion ETF industry's dominance. Tokenized assets, which represent real-world securities on blockchain networks, have gained traction in decentralized finance circles but face regulatory hurdles and liquidity concerns.

This regulatory shift could benefit Bitcoin and cryptocurrency exchange platforms by expanding their product offerings beyond digital assets. While tokenization technology promises enhanced accessibility and 24/7 trading capabilities, traditional ETFs maintain advantages in institutional adoption, regulatory clarity, and market depth. The crypto market continues evolving as regulators balance innovation with investor protection, potentially reshaping how institutional and retail investors access traditional securities through blockchain technology.