eToro to Launch Tokenized US Stocks for European Investors on Ethereum

eToro announced plans to launch tokenized versions of US stocks and ETFs on the Ethereum blockchain, starting with European customers in August 2025. This move follows earlier initiatives by other crypto exchanges and fintech companies.

August 1, 2025

A growing trend

eToro is building on the growing trend of tokenized stocks, following earlier launches by players such as Robinhood, Kraken, and Ondo Finance. Robinhood debuted tokenized US stocks and ETFs with 24/5 trading earlier this year, while Kraken and Bybit introduced similar offerings integrated with decentralized exchanges. Ondo Finance has also expanded into tokenized stocks with institutional-focused platforms. These initiatives have helped pave the way for eToro’s compliant, Ethereum-based entry in the space.

Traditional Finance Into the Blockchain Ecosystem

Tokenization refers to the process of creating blockchain-based digital tokens that represent ownership of traditional assets, in this case, company shares. The tokens correspond to actual shares held in custody by eToro or its partners, ensuring regulatory compliance and investor protection. By leveraging Ethereum’s smart contract capabilities, eToro plans to facilitate near-instant settlement, fractional ownership, and seamless integration with the emerging DeFi ecosystem.

Initial offerings are expected to cover around 100 popular US stocks and ETFs, including market leaders across various sectors. Customers, starting with those in Europe, can anticipate accessing tokenized stocks as soon as August 2025, with a staggered rollout to other jurisdictions to follow contingent on regulatory approvals and compliance frameworks.

What This Means for Investors and Markets

The move to tokenized stocks offers several potential advantages over traditional equity trading:

  • Extended Trading Hours: Unlike conventional stock exchanges with fixed trading sessions, tokenized stocks on Ethereum can be traded 24 hours a day, five days a week, providing investors with greater flexibility and responsiveness to global market events.
  • Lower Barriers and Fractional Ownership: Tokenization enables fractional shares, allowing investors to buy smaller increments of high-value stocks, thus increasing accessibility for retail traders without requiring full share purchases.
  • Automation and Efficiency: Smart contracts automate settlements and transfers, reducing the need for intermediaries and cutting processing times and costs typically associated with conventional brokerage settlements.
  • Integration with DeFi: Token holders can leverage their stock-backed tokens as collateral, participate in yield farming, or use them in decentralized exchanges, offering new liquidity options and financial innovation.

Regulatory Context and Compliance

eToro’s initiative benefits from a progressively clearer regulatory landscape. In Europe, the Markets in Crypto-Assets (MiCA) regulation—expected to be fully implemented by 2026—provides legal frameworks governing digital asset services, supporting tokenized securities while prioritizing investor safeguards.

In the United States, evolving legislation like the GENIUS Act aims to create clearer pathways for digital securities innovation and compliance. eToro’s approach, led by CEO Yoni Assia, emphasizes prudence and adherence, taking a stepwise rollout to comply with jurisdictional requirements and ensure investor protections comparable to traditional stock ownership.

Competitive Dynamics in Tokenized Securities

eToro joins a growing list of financial services providers exploring tokenized stocks, including platforms like Robinhood, Kraken, and others. However, its focus on Ethereum—a dominant smart contract platform—and early European user base distinguishes it in the emerging market.

By anchoring the tokens on a well-established blockchain and leveraging its global user base, eToro aims to build liquidity and network effects that could accelerate adoption. The ability to bridge traditional stocks with DeFi innovations positions the company strategically at the intersection of legacy finance and next-generation digital markets.

Challenges Ahead

Despite the promise, tokenized stock trading is not without challenges. Regulatory hurdles remain complex and vary significantly by country, requiring careful navigation to avoid legal risks. Investor education is also critical, as tokenized securities combine traditional equity risks with novel technological considerations.

Market participants must also address concerns about custody security, transaction finality, and potential liquidity fragmentation between tokenized and traditional venues. Ongoing dialogue between regulators, issuers, and platforms will be essential to establish standards and mutual trust.

Looking Forward: A Step Toward Financial Digitization

eToro’s planned launch of tokenized stocks on Ethereum signals a meaningful evolution in equity markets. By integrating blockchain’s transparency, programmability, and accessibility with traditional stock ownership, tokenization potentially democratizes markets and fosters financial innovation.

While still in its early stages, this initiative exemplifies the broader trend of convergence between decentralized technologies and established finance, one likely to reshape trading, settlement, and asset management over the coming years.