Billionaire Michael Novogratz, founder of Galaxy Digital Holdings Ltd. (GLXY, Financial), has revealed that the company is in discussions with the U.S. Securities and Exchange Commission (SEC) about tokenizing its own stocks and other securities through its digital asset platform. Galaxy Digital aims to register its stocks on the blockchain, having met with the SEC's cryptocurrency task force earlier this year. Previously listed only in Canada, Galaxy Digital began trading on Nasdaq recently, managing approximately $7 billion in assets.
The company's vision is to transform its stocks into tokens that can be used in decentralized finance (DeFi) applications such as lending and trading. This process could eventually extend to tokenizing other assets like fixed-income products and ETFs, making them available for U.S. investors. Tokenization offers benefits like easier authenticity verification, rapid settlement, and 24/7 trading capabilities.
SEC's cryptocurrency task force recently held a roundtable on tokenization, highlighting the potential evolution akin to the shift from analog to digital media. While some market funds like BlackRock's BUIDL have started tokenizing, the total real-world assets on public blockchains remain minimal.
Galaxy Digital has chosen to list on Nasdaq amid increasing competition among crypto firms. Other companies like eToro, Circle, Kraken, and Gemini are also pursuing public listings as the crypto market shows signs of recovery.
