IPO without Wall Street: Can blockchain replace the stock market?

Binance founder Changpeng Zhao believes initial public offerings will eventually move onchain. Tokenized securities already allow trading beyond regular exchange hours, but moving the IPO itself onchain is far more complicated—how realistic is that idea?

The distinction between the two is fundamental. Most tokenized stocks today merely bring the trading of an existing security onto the blockchain, while an IPO starts earlier—with a company issuing equity, distributing shares, and granting investors legal rights.

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The technological infrastructure for issuing and recording shares already exists. So far, however, it is transforming the trading of existing assets much faster than the process through which companies raise capital.

Tokenized stocks gain momentum

The market is growing rapidly. In the second quarter of 2026, trading volume for tokenized stocks on decentralized platforms on Solana reached around $5.8 billion. In July, total monthly volume for such instruments rose to roughly $11.3 billion, with Binance bStocks products accounting for about $9.4 billion.

Almost all bStocks volume, however, came from a single instrument—a tokenized QQQ fund—meaning the market's growth remains highly concentrated.

The main advantage of these instruments is that they are easy to understand. Investors can gain exposure to the price of Nvidia, Tesla, or another U.S. stock through crypto infrastructure and trade when traditional stock exchanges are closed.

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Demand for trading outside regular exchange hours is already evident.

According to Binance Research, in the week through July 28, around 92% of onchain bStocks volume occurred outside regular U.S. stock market hours. In absolute terms, however, the market remains small: trading in these tokens amounted to around 0.3% of the volume in their corresponding underlying stocks and exchange-traded funds.

This is where the first limitation of CZ's prediction emerges.

bStocks do not mean Nvidia or Tesla have issued shares on BNB Chain. The platform is operated by a Binance-linked entity, while the securities backing the tokens are held by a regulated custodian. Holders gain economic exposure to the stock but do not directly own the underlying security.

Robinhood uses a similar model in Europe. Its tokenized stocks also track the price of an underlying share, but legally they represent a contract between the customer and the company rather than a record of ownership in the actual stock.

A stock is more than a price on a screen]

The problem becomes clearer when

 considering investor rights. A real share provides more than the opportunity to profit from price appreciation: it can also carry voting rights, dividends, participation in corporate actions, and certain claims against the company.

Many tokenized products available today do not provide these rights. Kraken explicitly states that holders of xStocks do not own the underlying securities and receive neither voting rights nor claims on the company's assets. Robinhood makes a similar disclosure for its tokens.

This is where conflicts can arise. OpenAI previously said it had not partnered with Robinhood on tokens linked to its shares and had not approved the product. Holding such an instrument does not give an investor rights to actual shares in the company.

That is not enough for a true onchain IPO. If a company raises new capital through blockchain infrastructure, the onchain record must do more than replicate the price of a security—it must legally represent ownership of a stake in the business.

Exodus offers an intermediate model. The U.S. public company participates in the tokenization of its own Class A shares on Solana and Algorand. Ownership records are maintained by a registered transfer agent, while investors retain the corporate and economic rights of actual shareholders.

Figure has gone further. In February, the company issued FGRS—its own SEC-registered common stock directly on a blockchain through the On-Chain Public Equity Network.

Unlike a token layered on top of a security held in a traditional depository, FGRS exists from the outset as a blockchain-registered share.

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Such structures show that a fully fledged public share can already exist directly onchain. But an IPO raises the next question: can not only the security itself, but also the process of raising capital for the first time, move on to the blockchain?

What blockchain can actually remove from an IPO

Even if a share becomes a fully fledged onchain asset, an IPO does not turn into a single smart contract. Before going public, a company undergoes audits, discloses financial information, prepares regulatory filings, and works with investment banks to assess demand and determine the offering price.

This is where the limits of blockchain become apparent. It can change the technical side of the process—ownership records, securities transfers, settlement, and subsequent trading. But the technology itself cannot audit a company's financial statements, find investors, or determine a fair offering price.

There is, nevertheless, an economic incentive for change. In a traditional U.S. IPO, underwriting fees have historically amounted to around 7% of the capital raised, excluding legal, accounting, and other expenses.

However, a significant portion of that fee pays for functions other than the technical transfer of shares, including finding buyers, assessing demand, and organizing the offering itself. Blockchain does not automatically eliminate those functions.

More obvious savings may come after the offering. Blockchain can shorten parts of the intermediary chain, combine ownership records and asset transfers within a single infrastructure, and accelerate settlement. Markets could also operate beyond traditional trading hours.

The advantage, however, is no longer as radical as it would have been several years ago. The U.S. stock market has moved to T+1 settlement—the next business day after a trade. Blockchain is therefore competing not with a system that takes several days to settle, but with one that is already becoming faster.

Who will ultimately move the market onchain?

The most interesting developments are now taking place outside crypto exchanges. The institutions that blockchain was theoretically supposed to replace are gradually adopting the technology themselves.

NYSE is already developing infrastructure for trading securities in tokenized form. Nasdaq is working on its own model that would involve issuers while preserving standard shareholder rights. DTCC, whose infrastructure handles settlement across the U.S. stock market, conducted live transactions with tokenized assets in July and is preparing a commercial service.

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More than 50 financial companies, including BlackRock, JPMorgan, and Goldman Sachs, are participating in the development of DTCC's solutions. LSEG is also working with Kraken's parent company on infrastructure for tokenized U.K. stocks.

This changes the meaning of CZ's prediction. If IPOs do move onchain, stock exchanges and banks do not necessarily have to disappear. Traditional intermediaries could instead integrate blockchain into the existing market.

Experiments are already moving beyond secondary trading. In September, India issued around $53 million in tokenized corporate bonds: a distributed ledger was used to record ownership, while settlement was conducted using a wholesale central bank digital currency.

It is not an IPO, but a company has already raised new capital through infrastructure similar to what would be required for an onchain share offering.

The main obstacle is not blockchain speed but the connection between a digital record and legally enforceable rights. As long as a token merely tracks the price of a real share, it can compete with brokers through convenience and extended trading hours. To replace an IPO infrastructure, it must become the share itself—with ownership rights, voting, dividends, and investor protections.

The most realistic scenario, therefore, does not look like the disappearance of Wall Street. Company registration, disclosure requirements, and investor relations will remain, while share issuance, ownership records, settlement, and trading could gradually move onto blockchain infrastructure.

IPOs can indeed move onchain, but crypto exchanges will not necessarily be the winners of that transformation. If traditional markets integrate blockchain into their infrastructure, investors may one day simply stop noticing the boundary between conventional and tokenized stocks.