Evolution of the Stock Market and Tokenization Trends

The development of the public stock market in the United States can be traced back to the early 20th century. In the early days, anyone could raise funds for projects through public stock offerings, but this practice was often accompanied by false promises. In the 1920s, stock speculation reached its peak, and the subsequent stock market crash triggered the Great Depression. To rebuild market confidence, Congress enacted a series of regulations requiring companies that publicly issued stocks to disclose detailed information and undergo audits.

However, these regulations only apply to publicly listed companies, while private enterprises can be exempted. Over time, the importance of the private placement market has been increasing day by day. Nowadays, many star technology companies are able to obtain large-scale financing at high valuations without going public. This trend makes it difficult for ordinary investors to participate in the investment of these popular companies.

To solve this problem, various solutions have been proposed, including simplifying the listing process, strengthening regulation of private enterprises, and even completely abolishing the rules for listed companies. However, in recent years, the cryptocurrency industry has provided a new idea: raising funds by issuing "tokens", bypassing traditional securities regulations.

Recently, a trading platform announced the launch of tokenized stock services, allowing users to trade US stock tokens and offering tokens from certain well-known private companies. This initiative aims to give more people the opportunity to invest in private companies without requiring these companies to disclose financial information.

Supporters argue that since the public can invest in other high-risk areas, why can't they invest in private company stocks? However, this practice essentially allows companies to sell shares to the public without disclosing information, which may undermine the existing securities law system.

Although this approach has not yet been fully realized in the United States, some big players in the financial sector are actively promoting it. They believe that tokenization can eliminate investment barriers and provide more people with access to high-yield opportunities. However, this has also raised concerns about market transparency and investor protection.

Looking back at history, we can find that whenever there are similar financial innovations, they can bring unexpected consequences. Currently, the financial industry seems to be seeking a way to make the stock market more like the cryptocurrency market, rather than incorporating the cryptocurrency market into traditional regulatory frameworks. This trend is worth our close attention and consideration of its potential long-term impacts.