Crypto Executive: DAT Stock Tokenization Increases Investor Risk
Jinse Finance reported that Kanny Lee, CEO of the decentralized exchange SecondSwap, stated: The digital asset treasury (DAT) companies that tokenize stocks on the blockchain increase risks for both investors and their own businesses. The tokenization of DAT equity is essentially creating a synthetic asset on top of another synthetic asset. Investors ultimately face double risks: first, the volatility of treasury-backed cryptocurrencies, and second, the complexity of company equity, governance, and securities law. This adds significant risk to already volatile assets. Severe on-chain price fluctuations occurring outside of traditional market hours may cause financial firms that have issued tokenized stocks and traditional stocks to experience a run on their shares, leaving the company with insufficient time to respond to price shocks.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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