Crypto exchange Binance has added new features to its application programming interface, signaling that the platform may be preparing to introduce stock trading capabilities.
In 2021, Binance launched tokenized stock trading, allowing users to buy digital versions of stocks like Tesla and Apple. The service was halted a few months later after regulators raised concerns about compliance and investor protection. The brief initiative highlighted both demand for tokenized equities and the challenges of offering them within existing financial rules.
New API Features
The new API updates include an endpoint for signing a TradFi-Perps agreement contract and two endpoints for checking weekly trading schedules and current session information.
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Analysts say the changes indicate Binance may be preparing to offer perpetual futures trading. The session-based schedule also suggests trading could follow regular market hours instead of the 24/7 format typical of cryptocurrencies .
Market Context
Binance’s activity comes as other firms move into tokenized stocks. Reports on Friday indicate that Coinbase is close to launching its own tokenized stock and prediction market offerings.
Regulatory Concerns
The growth of tokenized stocks has prompted regulatory concerns. Earlier this month, market maker Citadel Securities urged the US Securities and Exchange Commission to tighten rules on tokenized stock trading on decentralized finance platforms.
Citadel said such platforms likely qualify as an “exchange” or “broker-dealer” and warned that allowing unregulated platforms “would create two separate regulatory regimes for the trading of the same security.”
Industry Perspective
The World Federation of Exchanges called tokenization “likely a natural evolution in capital markets” and “pro-innovation,” but warned it “must be done in a responsible way that does not put investors or market integrity at risk,” Cointelegraph reported.
Tokenized stocks have expanded into both centralized exchanges and DeFi platforms. By the end of June, more than 60 tokenized stocks had launched on Solana-based DeFi platforms, as well as on Kraken and Bybit.