Wall Street Tokenization Wave May Birth Bigger Winners; Research Institutions Bullish on Multiple Stocks and Crypto Projects

FX168 Financial News As Wall Street accelerates its embrace of blockchain technology, tokenization is seen as potentially opening a massive new market, but research firm Citrini Research believes investors betting on this trend need not limit their attention to Bitcoin (BTC) and Ethereum (ETH).

In a 79-page report titled "Breaking the Wall" released on Thursday, the firm pointed out that moving stocks, bonds, and other financial assets onto the blockchain could give rise to a range of new businesses in trading, lending, and payments, with the greater beneficiaries potentially being the companies and crypto projects that collect fees from these activities.

The report states that tokenization converts traditional assets into digital tokens that can circulate between financial platforms, with the potential for around-the-clock trading. For example, a tokenized stock could even serve directly as collateral for loans initiated from an investor's digital wallet, without going through traditional brokers.

Citrini notes that its research team gained prominence through its artificial intelligence-related research, with its views once triggering significant market volatility; the firm currently operates a Substack newsletter with over 263,000 subscribers.

Tokenization May Reshape Financial Fee Models

In Citrini's view, the flexibility brought by tokenization will open new space for trading platforms, lending institutions, stablecoin issuers, and securities ownership record service providers.

The report explicitly states that the market should not assume that major crypto assets—especially BTC and ETH—will necessarily reach new highs as a result; even if they do rise, they may not be the best way to participate in this theme.

To identify investment opportunities, Citrini proposed two investment baskets: one focused on publicly traded companies and the other on crypto tokens. The emphasis is on companies that can continuously collect fees as more Wall Street business moves "on-chain."

The report mentions that tokenization company Securitize (SECZ) is responsible for maintaining the legal connection between blockchain tokens and the securities they represent; crypto exchange Coinbase (COIN) and digital broker Robinhood (HOOD) can gain exposure through trading platforms and blockchain infrastructure; stablecoin issuer Circle (CRCL) may benefit from rising demand for USDC stablecoin, as USDC can be used for transaction settlement.

The report also highlighted Figure Technology Solutions (FIGR), suggesting it could benefit from tokenized lending; SoFi (SOFI) may gain from stablecoin payments; and institution-focused digital asset exchange operator Bullish (BLSH) was also included on the list.

Notably, Bullish is also the parent company of CoinDesk and is acquiring equity registry firm Equiniti.

Crypto Token Basket Garners More Favor

Compared to the publicly traded company basket, Citrini stated that it is "actually more interested" in the crypto token portfolio, as it can provide broader exposure than the limited range of publicly traded companies.

The report states that if stocks, commodities, and other financial assets genuinely continue migrating on-chain, then the financial products built around these assets will eventually follow.

In token selection, the report is bullish on Aerodrome (AERO), suggesting it could collect fees from tokenized stock trading as a trading platform; Maple (SYRUP) is viewed as a management platform for on-chain lending products targeting institutional investors. Pendle (PENDLE) allows investors to trade future returns on interest-bearing assets; Ondo Finance (ONDO) offers tokenized U.S. Treasury bonds and stock products, recently expanding into perpetual contracts. Aave (AAVE) provides lending infrastructure, Uniswap (UNI) offers a decentralized trading marketplace, and Ethena (ENA) issues stablecoins and has expanded into digital finance, integrating high-yield savings, cards, and payment features.

Additionally, Citrini's token basket includes ether.fi (ETHFI), a project focused on crypto financial services; Chainlink (LINK) provides market data; and LayerZero (ZRO) is used to connect different blockchains.

The report believes that as tokenized assets spread across financial platforms and blockchain networks, all three could benefit.

Another project highlighted is Derive (DRV), a decentralized options trading protocol that could benefit if tokenized stocks and other financial assets drive more derivatives trading on-chain.

Perpetual Contract Sector Also Viewed Favorably

The report also mentions emerging perpetual contract trading platforms Lighter (LIT) and Variational (VAR). Perpetual contracts are instruments that allow traders to bet on asset price movements without holding the underlying asset; unlike traditional futures, they have no expiration date.

Citrini notes that Hyperliquid (HYPE) has become the dominant platform for on-chain perpetual contract trading, while Lighter and Variational, these two challengers, may gain more attention as the broader perpetual contract market expands. Citrini also included exposure to Hyperliquid through the Bitwise Hyperliquid ETF (BHYP) in its stock basket.

However, the report also cautions that growth in trading volume and network activity does not always directly translate into token price appreciation. Investors need to focus on how protocols make money, who collects the fees, and whether token holders can share in those revenues.

The report also points out that liquidity being dispersed across multiple competing blockchains, cybersecurity risks, and legal obstacles facing synthetic tokenized stocks could all slow the pace of this trend. The latter, while allowing investors to gain price exposure, does not grant the voting rights or direct ownership attached to traditional stocks.

From a market perspective, if tokenization continues to advance, the beneficiaries may extend beyond BTC and ETH, spreading to a broader "fee-earning chain" including trading platforms, stablecoins, lending, data services, and cross-chain infrastructure. For investors, this means opportunities around "putting assets on-chain" may manifest more in business models and fee-capturing capabilities rather than simply betting on mainstream cryptocurrencies themselves.