Binance Starts Offering Tokenized Share Trading with Tesla Stock

Binance is entering the tokenized stock trading space by enabling its users to trade tokenized Tesla stocks, the cryptocurrency exchange giant announced on Monday.

The exchange detailed that each stock token will represent a single unit of the company share. Binance will allow investors to trade fractions of the tokens, the minimum being a hundredth of the token, which will increase demand and Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term.

Though the crypto exchange only introduced Tesla, a company with a huge Bitcoin investment, initially, it has plans to add more stocks to its offering.

Following Competitors

Binance is following the steps of its competitors like FTX and Bittrex Global to introduce such services with tokenized stocks. The move did not come as a surprise as the exchange’s Founder and CEO, Changpeng Zhao, earlier revealed his intentions to introduce such services.

The exchange has partnered with the German investment firm, CM-Equity AG, and Swiss asset tokenization platform, Digital Assets AG, to bring the tokenization services. Both these companies also serve Binance competitors.

Unlike FTX and Bittrex Global, Binance will allow the services only during the market hours, meaning traders can buy and sell Tesla stock within Nasdaq opening hours. The stock tokens will be priced and settled in BUSD, the exchange’s native USD-pegged stablecoin.

“Binance serves many users around the world, and we are very pleased to be able to help them participate in the equity market. Stock tokens demonstrate how we can democratize value transfer more seamlessly, reduce friction and costs to accessibility, without compromising on compliance or security,” Zhao said in a statement.

“Through connecting traditional and crypto markets, we are building another technological Bridge Bridge The bridge or liquidity bridge is an essential component for brokers that are enabling their clients to trade at interbank rates directly via a Prime Broker or a Prime-of-Prime (PoP). While market makers do not require a bridge in order to service its clients, brokers which are sending through orders to a liquidity provider or an electronic execution venue need a bridge to connect their trading platform to the interbank market.Bridges are used extensively in forex trading, specifically for Metat The bridge or liquidity bridge is an essential component for brokers that are enabling their clients to trade at interbank rates directly via a Prime Broker or a Prime-of-Prime (PoP). While market makers do not require a bridge in order to service its clients, brokers which are sending through orders to a liquidity provider or an electronic execution venue need a bridge to connect their trading platform to the interbank market.Bridges are used extensively in forex trading, specifically for Metat Read this Term for a more inclusive financial future.”