Tokenized Stocks Grew 10 Times in a Year to $4.8 Billion. How Much of It Runs on Ethereum? - 24/7 Wall St.
The market for tokenized stocks has grown tenfold over the past year to $4.82 billion, yet Ethereum's price continues to fall despite its potential connection to this booming sector.
The market for tokenized stocks—blockchain tokens representing shares held by custodians—has expanded dramatically, growing about ten times over the past year to reach $4.82 billion, according to issuer Ondo. This surge stands in stark contrast to the performance of Ethereum (CRYPTO:ETH), which has fallen 15.9% over the past 30 days and 30.8% since January, despite the potential connection between tokenized stocks and the Ethereum network.
The $4.82 billion figure represents the market value calculated by multiplying the number of tokenized shares in circulation by their stock prices. This total can increase not only through new token creation but also when underlying stock prices rise. Ondo, which sells its own tokenized shares known as Ondo Stocks, has made Fidelity's FCAT a mandatory verifier for transfers between different blockchains.
BNB Chain Leads Tokenization
Contrary to what many ETH holders might hope, the largest tokenized stock product operates on BNB Smart Chain, not Ethereum. While issuers and tracking platforms like rwa.xyz don't provide a detailed breakdown of the $4.82 billion by blockchain, evidence indicates Ethereum holds only a minority share. Rival issuer Binance claims its bStocks product holds $1.5 billion in assets, making it the largest single product in this market.
Other major issuers distribute their tokens across multiple blockchains, including Ethereum and Solana, which has also seen its price drop 20.6% in the last month. Newer deals continue to launch on alternative blockchains, such as the NYSE-affiliated platform settling on Avalanche and one major issuer choosing Solana over Ethereum.
Why ETH Price Isn't Benefiting
The growth in tokenized stocks hasn't translated to increased demand for Ethereum because holders typically transact in dollars or stablecoins, needing only minimal ETH for network fees. This pattern mirrors what's seen with tokenized funds from major banks. The fee burn mechanism, which destroyed portions of transaction fees, previously helped shrink ETH's supply, but the Dencun upgrade in March 2024 drastically reduced fees on layer-2 networks.
The burn was never a true floor for the price.
The Ethereum network now issues about 2,600 new ETH daily (roughly $5.3 million) to validators, while burns on quiet days only eliminate around 50 to 70 ETH, causing ETH supply to continue growing. More impactful on price are spot Ethereum ETFs, which reported a $185 million net outflow on November 9, reducing total net assets to $12.1 billion.
Market Outlook
ETH remains below its key moving averages, closing at $2,050 on November 10—its lowest close in 30 days. The cryptocurrency is trading below its 20-day average of $2,273, 50-day average of $2,457, and 200-day average of $2,152. A clear sign of potential recovery would be a full week of net inflows into spot Ethereum ETFs following the recent outflow.
On the price front, ETH could find support if it closes back above its 200-day moving average near $2,152. Conversely, a close below the recent $2,050 low would indicate that sellers remain in control. While tokenized stocks continue to grow, their distribution across multiple blockchains means they're unlikely to significantly impact ETH's price until ETF flows reverse and the market's structure shifts.
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