Blockchain Technology Expands to Traditional Financial Assets

Blockchain technology has expanded beyond cryptocurrencies, with an increasing focus on traditional financial assets like stocks and real estate. This shift has given rise to the concept of tokenization, where digital tokens represent economic exposure to shares or properties.

The use of blockchain-based infrastructure, such as Robinhood Chain, is being explored for enabling self-custody of these tokenized assets. Self-custody refers to the direct management of digital assets by users, rather than relying on custodians. This approach aims to improve transparency and settlement efficiency while maintaining regulatory oversight.

Tokenization of stocks and real estate involves creating digital tokens that represent fractional interests in shares or properties. These tokens can be issued against underlying assets held by regulated custodians or brokerage entities. The process is governed by existing securities, property, and financial regulations, which may require Know Your Customer (KYC) procedures, anti-money laundering (AML) compliance, and disclosure and reporting obligations.