Delphi Digital said Backpack’s stock tokens may give holders a stronger claim on the underlying shares than many other tokenized stock products. The firm noted that holding a stock token does not always grant the same rights as holding shares through a broker, and that many stock tokens only settle in cash at redemption. In Backpack’s case, eligible holders can redeem tokens into stock positions in a Backpack brokerage account, then move those shares to another broker through the Automated Customer Account Transfer Service (ACATS) and the Depository Trust & Clearing Corporation (DTCC) system. Delphi Digital said those redeemed positions represent a security entitlement, which carries the same legal interest an investor would hold after buying stock through a traditional broker. It also said Backpack’s token itself is a claim on the entity that holds the shares, so the rights attached to the token and the redeemed stock position are not the same. According to the post, redemption changes the nature of the asset the investor holds while preserving stock exposure.
Techub News reported that Delphi Digital said in a post on X that Backpack’s stock tokens may give holders a stronger claim on the underlying shares.
According to Delphi Digital, owning a stock token does not always give investors the same rights they would have if they held the stock through a broker. Many other tokenized stock products only pay out cash upon redemption.
Backpack, by contrast, allows eligible holders to redeem their tokens into stock positions in a Backpack brokerage account. Those shares can then be transferred to another broker through the Automated Customer Account Transfer Service, or ACATS, and the Depository Trust & Clearing Corporation, or DTCC, system. Delphi Digital said the resulting position is a security entitlement, carrying the same legal interest an investor would hold when buying shares through a traditional brokerage.
At the same time, Backpack’s token is itself a claim on the entity that holds the stock, which means the rights are different from directly holding the shares. Delphi Digital said the redemption process changes the nature of the asset the investor owns while keeping the same stock exposure.
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