Three Paths to Tokenized US Stocks and the Five-Layer Structure
What crypto exchanges (CEXs) list as “US stocks” is not the same as owning real equity. Currently there are three routes: direct API access to traditional brokers, tokenized assets, and perpetual swaps. The tokenized model involves a five-layer architecture: underlying asset custody (real stocks held by regulated brokers), token issuance (synthetic representations), trading execution (CEX internal order books), clearing and custody (Alpaca dominates), and user-facing front ends. This structure means investors hold “equity derivatives” rather than direct share ownership.
Erosion of Rights: Voting, Dividends, and Investor Protection
Under tokenization, voting rights vanish completely – the underlying custodian retains or delegates voting power, leaving token holders with zero governance voice. Dividends are not automatically distributed; they rely on contractual payout mechanisms by the issuer, introducing delays and default risk. Worse, the Securities Investor Protection Corporation (SIPC) covers only genuine securities accounts; tokenized assets are excluded. If the custodian or issuer fails, investors have no SIPC safety net.
Alpaca's 94% Clearing Monopoly: Liquidity Fault Lines
Reports indicate that Alpaca handles approximately 94% of all CEX US stock clearing and custody. This hyper-concentration creates two critical risks: first, during market stress, Alpaca may suspend clearing due to technical glitches or risk controls, causing a liquidity break – orders on CEXs fail to execute and withdrawals get stuck. Second, if Alpaca itself faces a liquidity crunch or regulatory action, the risk cascades to all dependent exchanges, forming systemic risk transfer. In essence, trading “US stocks” on CEXs exposes investors to multi-layered counterparty credit risk, fundamentally different from the real US equity market.