Digital Stocks

Definition ∞ Digital stocks refer to traditional equity shares that have been tokenized and represented as digital assets on a blockchain. These tokens grant ownership rights analogous to conventional stocks, but their transfer and record-keeping occur on a distributed ledger. This tokenization aims to increase liquidity, fractionalize ownership, and streamline trading processes. They allow for a new method of capital formation and investment.
Context ∞ The concept of digital stocks is a prominent topic in discussions about the future of capital markets and the integration of blockchain technology into traditional finance. Regulatory bodies are actively working to define the legal status and oversight requirements for these tokenized securities. A critical future development involves establishing interoperable platforms and clear regulatory guidelines to facilitate widespread adoption and trading.