Binance has announced that it will be listing three new stock tokens in the coming week, following the launch of tokens tracking the performance of Tesla and Coinbase shares earlier this month.
The announcement was made on Apr. 26, detailing the launch of tokenized stock pairings for leading business intelligence firm, Microstrategy (MSTR) as well as multinational tech firms Apple (AAPL) and Microsoft (MSFT).
The listing of these stock tokens will allow users to trade fractionized units of a share token. The minimum trade sizing is one one-hundredth of a token.
The listing schedule for Microstrategy (MSTR) is set for Apr. 26, at 1:30 PM (UTC), Apple (AAPL) for Apr. 28, and Microsoft (MSFT) for Apr. 30 all at the same time.
According to Binance, its stock tokens are fully backed by a depository portfolio of underlying securities held by CM-Equity AG, Germany (CM-E). The holders of these stock tokens will be eligible for economic returns on the underlying shares, including possible dividends.
Binance will therefore monitor the demand and look to provide a channel to more stock tokens issued and sold by CM-E. The trading of these stock tokens will follow traditional exchange hours.
The stock tokens will only be tradeable against Binance’s stable coin BUSD. They will have trading pairs like MSTR/BUSD, AAPL/BUSD and MSFT/BUSD. However, residents of mainland China, Turkey, the United States and other restricted areas by CM-E will not be able to trade.
Those in other jurisdictions will only be allowed to trade after satisfying all requisite Know-Your-Customer and other relevant compliance requirements.
Binance Stock Tokens
Binance stock tokens represent one ordinary share of the relevant stock, or shares of public companies. The stock tokens are tokens of shares of public companies trading on traditional stock exchanges. The first Binance stock token was launched on Apr. 12, which allowed users to speculate on the price of Tesla (TSLA). In additional, Binance listed fractional shares for Coinbase on Apr. 15.
The expansion of the exchange into stock shares is an illustration of an increase in competition between Binance and FTX, a Hong-Kong headquartered crypto derivatives platform. FTX launched fractionalized stock trading in October 2020, including derivatives that track both Tesla and Apple shares. The products by FTX were also launched in partnership with CM-E. There are more than a dozen equity and crypto pairings available for trade on FTX including Amazon (AMZN) derivatives.
Image courtesy of Flickr