Equity instruments represent ownership interests in a company, granting holders a claim on its assets and earnings. These financial tools typically include common stocks, preferred stocks, and warrants, providing varying degrees of voting rights and dividend eligibility. Their value fluctuates based on company performance, market conditions, and investor perception. Equity instruments are a fundamental component of traditional capital markets.
Context
In the digital asset sphere, the distinction between equity instruments and certain tokens is a central point of regulatory discussion. Securities regulators assess whether specific cryptocurrencies or digital assets should be classified as equity, thereby subjecting them to existing securities laws. This classification significantly impacts token issuance, trading, and investor protection requirements.
Mercado Bitcoin leverages Stellar to tokenize $200 million in financial instruments, streamlining asset access and cross-border liquidity across Latin America.
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