The $69 trillion US stock market is crypto’s next proving ground, according to Castle Labs.
The research and advisory firm argues that tokenised equities are evolving from niche experiment to institutional-grade infrastructure, propelled by platforms such as Ondo, retail-focused networks like xStocks, and sophisticated derivatives engines such as Hyperliquid.
“This is ultimately a discussion about choice, self-agency and inventiveness,” Castle Labs’ pseudonymous analyst TradFiHater said.
Castle Labs is not the only firm flagging the acceleration of tokenisation.
In January, BlackRock CEO Larry Fink called for the financial system to run on “one common blockchain” during a speech at the World Economic Forum at Davos, Switzerland.
“We would be reducing fees, we would do more democratisation,” Fink said. “[If] we have one common blockchain, we could reduce corruption.”
Paradigm shift
Castle Labs argues that crypto’s early thesis revolved around digital assets, boom-and-bust cycles, and the belief that returns lived primarily inside the blockchain.
But that conviction frayed as stocks printed fresh highs while many crypto tokens failed to reclaim their peaks.
The practical appeal of tokenisation, it argues, is 24/7 trading.
A trader can short Tesla shares at midnight, borrow against Nvidia without a brokerage account, trade pre-IPO exposure, or earn yield on collateral in DeFi vaults.
Castle Labs highlighted three companies that will lead the stock-tokenisation charge.
Ondo
Castle Labs says Ondo represents the institutional flank of that shift.
Founded by former Wall Street operators, Ondo spent years refining tokenised Treasury products before expanding into equities.
Its model is indirect tokenisation. An offshore special-purpose vehicle purchases and holds the underlying shares through a US-registered broker-dealer.
Onchain tokens represent structured claims on that collateral, and holders enjoy economic exposure but not corporate voting rights.
xStocks
Launched by Backed Finance and later acquired by Kraken, the xStocks platform offers tokenised equities and exchange-traded funds across multiple blockchains.
The regulatory footprint spans Jersey, Liechtenstein and Switzerland.
The legal wrapper differs, but the principle remains the same: tokens are tracker certificates backed one-for-one by Oracle’s securities held in segregated accounts.
Holders are creditors of the issuer, and dividends are reinvested by distributing additional tokens.
A swap engine known as xChange links decentralised exchanges with traditional market hours, siphoning offchain liquidity into onchain pools.
Hyperliquid
Castle Labs treats Hyperliquid as a different species.
HIP-3, activated last autumn, allows builders who stake the native HYPE token to launch perpetual futures markets on virtually any asset with a price feed.
There are no shares in custody, no SPVs, no dividends. Traders can be long or short on synthetic contracts settled in stablecoins.
Instead of a traditional finance custody chain, there is just an oracle and a margin engine. This architecture thrives on speed and flexibility.
Oil, gold, tech giants, and even pre-IPO exposures become tradable around the clock.
During recent geopolitical turmoil, tokenised oil saw over $1 billion in trading volume as traders sought a weekend hedge unavailable on traditional exchanges.
