Global Exchanges Urge Regulators to Limit Risk of Tokenized Stocks

Major global stock exchanges are calling for tighter regulations on the rise of ‘tokenized’ securities, arguing these digital versions of traditional stocks lack key investor protections and could pose significant risk. The World Federation of Exchanges (WFE) has issued a letter to regulators like the SEC, ESMA, and IOSCO, warning them about the potential dangers of tokenized equity offerings. The WFE highlights that these digital tokens often mimic real-world shares without offering similar rights or safeguards such as voting, dividend payments, and secure custody.