As Robinhood Doubles Up On Tokenized Stocks, EU Securities Watchdog Executive Flags Risks of ‘Investor Misunderstanding’
A top executive of the European Union’s securities watchdog said Monday that tokenised stock offerings could potentially lead to “investor misunderstanding.”
Need For Clear Communication And Safeguards
Natasha Cazenave, executive director of the European Securities and Markets Authority, delivered a keynote speech on tokenization, the digital representation of financial products on blockchains, at a conference in Croatia.
“This is not just a technological evolution. It could lead to a transformational change of our markets,” Cazenave said. “It can also cut costs for businesses by embedding compliance and reporting obligations directly into digital assets.”
Cazenave stated that while some fintech businesses have introduced products that provide exposure to a company’s listed shares, they do not confer shareholder rights.
“If structured as synthetic claims rather than direct ownership, this can create a specific risk of investor misunderstanding and underlines the need for clear communication and safeguards,” the …
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