Coinbase considers Coin Tokenization on Base

Coinbase, the largest cryptocurrency exchange in the United States, is considering offering tokenized shares of its COIN stock to local users through its Ethereum Layer-2 network, Base.

This move combines traditional stocks with blockchain technology, making Coinbase a leader in financial innovation.

Regulatory transparency key to Coinbase's Tokenized Shares release in the US

Jesse Pollack, lead developer of Base, explained that Coinbase is still in the early stages of exploring this initiative. Adherence to regulatory compliance is the primary hurdle.

Pollak emphasized that Coinbase is committed to addressing these challenges to ensure safe and legal issuance of token assets.

“We are in an exploratory phase and working to understand what needs to be unlocked from a regulatory perspective to bring assets like $COIN in a secure, compliant and future-proof way,” Pollack said.

Currently, the COIN shares decentralized platform is only available to international users. Expanding this access in the U.S. hinges on clear regulatory guidelines, Polk said. Moreover, such developments open the door to a wider audience for blockchain-based financial systems.

Meanwhile, Pollak suggested that tokenized COIN shares may be the first of many such products on the Base network. Last year, the Ethereum layer-2 network became a fast-growing and important player in the industry, with a total value of more than $3.84 billion (TVL).

Pollak expressed confidence in the platform's potential to reach $1 trillion in assets under management. According to him, this will further strengthen BASE's role as a hub for next-generation financial solutions.

“We're going to bring $1 trillion in assets to the base, and it's going to happen faster than anyone expected,” Pollack added.

Meanwhile, Coinbase's move to tokenization isn't surprising, considering the sector's rapid growth over the past year. Industry leaders, including Bitwise CEO Hunter Horsley, believe tokenization could reshape equity markets by creating a more inclusive capital markets system.

Horsley points out that tokenization allows smaller businesses to access equity markets without the massive scale typically required for public offerings.

“Today, approximately 4,600 companies in the U.S. have access to the public equity markets. The NAICs estimates that there are more than 200,000 companies in the U.S. with revenues of more than $10 million. Not all companies want to be public of course; But many simply cannot because it requires a large scale. Enter tokenism, a newly democratized capital market,” Horsley said.

In fact, Coinbase is the first publicly traded crypto exchange in the United States, with a market capitalization of around $70 billion. Austin Campbell, an assistant professor at Columbia Business School, recently praised the institution for opposing excessive regulatory measures against the crypto industry in the US.