The Tokenized-Stock Fight Is Really About Who Builds a Real 24/7 Market

The war of words started when AMC CEO Adam Aron branded Robinhood's tokenized AMC shares a "quasi-fake market" and threatened legal action. Robinhood CEO Vlad Tenev fired back that a public company doesn't get to approve every product built on its stock. Since then the industry has argued over which flavor of tokenized stock is legitimate — and the SEC has weighed in.

On September 17, the SEC granted a five-year exemption letting tokenized US stocks trade onchain in the United States — but only where the token carries the same dividends, voting rights, and share-class rights as the underlying stock. Synthetic exposure like Robinhood's is excluded, according to a CoinDesk analysis.

What happened when AMC's token broke its peg

While the NYSE is open, wrapped tokens mostly track the stock: across seven sessions, Robinhood's AMC token closed within 0.87% of the NYSE close at the median (2.71% at the widest) in the Uniswap pool carrying about 95% of its trading, per the analysis.

When the market closed, the picture changed. On September 3, the token surged from $2.55 to $23.16 — nine times AMC's $2.54 NYSE close seven hours earlier — before collapsing to $3.26 within the same hour, on roughly $10.5 million in pool volume. Robinhood's Jersey issuer names only one authorized participant able to create and redeem tokens, yet none were minted or burned during the spike. Without borrowing infrastructure, dealers couldn't sell short to capture the premium — the mechanism that keeps depositary receipts and ETFs aligned.

The sellers who brought it down weren't arbitrageurs, per the analysis — they were holders taking profit. And the spark was pure crypto chaos: hours after Aron's post, a memecoin denominated in tokenized AMC launched, and rising demand for the meme token pushed the pool to sell AMC tokens, dragging the stock token's price with it. An instrument built to track a cinema chain's shares was priced by memecoin speculation.

Two models, opposite trade-offs

Wrapped tokens win on reach: no issuer agreement, no shareholder-register entry, no per-market authorization. That's how Robinhood's stock tokens cover 190+ companies across 120 countries, with xStocks and Ondo doing the same via different plumbing. The cost is dislocation risk — the NYSE session runs just 32.5 of the 168 hours in a week, and holders carry the premium between the token and the share's last close.

Issuer-sponsored tokens (ISTs) go the other way: the token is the registered share itself, with voting rights and corporate actions, removing conversion and counterparty risk. But they sacrifice the wrapper's global reach, and today only a handful exist — Bullish's BLSH among them — with thin liquidity.

The analysis argues the industry is asking the wrong question. The real gap is building a market beyond issuance: run both models, and the wrapper gets a live price reference market makers can actually arbitrage against, while the IST market draws flow from those arbitrageurs. To cap damage meanwhile, the SEC's exemption limits onchain trading to 0.25% of a large-cap stock's average daily volume (2.5% for others). Offshore wrapped tokens, Robinhood's included, fall outside SEC jurisdiction and continue as-is.

Crypto prices are volatile and the figures above reflect the reporting of the cited sources at the time of publication.

Written by the BidAsk Newsroom. Based on reporting from the sources below.