Tokenisation has been one of finance’s biggest buzzwords for years. But most tokenised assets barely trade. Products like xStocks and new networks like Robinhood Chain are putting tokenised stocks in front of more investors. What will it take to go mainstream? Joining me is Connor Howe, CEO and Co-Founder of Enso, which builds the behind-the-scenes technology that lets institutions trade and manage assets on the blockchain. Connor, thank you so much for being with us.
Thanks for having me today.
Tokenisation has been a buzzword for years. Yet most tokenised assets barely trade. What is holding adoption back?
Providers like xStocks, Securitize, and others have figured out how to tokenise these assets. What we are missing inside the crypto world now is the supply side — how do users who are not familiar with crypto start interacting with these tokenised assets? We have enabled over $22 billion to be settled on-chain. And from all the different primitives we enable — tokenisation, lending, borrowing — the most successful ones have found a way to distribute into many different applications. The base layer is there. What we are missing for this to go to the next ten levels of integration is more applications starting to integrate these protocols under the hood.
What has to happen for tokenised stocks to trade as easily as stocks do in traditional markets?
Inside crypto, people can tokenise different assets through many different providers. The first problem is that users want to buy a particular tokenised asset but do not want to choose between 20 different versions of the same stock. Nvidia stock exists across Robinhood, xStocks, and Securitize. Users are confused about which is real. One way this becomes a lot easier is through an abstracted layer like Enso — allowing users to interact with any of these versions across any different chain. If a user is very familiar with Ethereum but a stock is on Arbitrum or Robinhood Chain, they need to bridge from Ethereum, get the gas required, and then buy. There are layers of user experience that need to be abstracted away. The base layer is there and it is functioning. Now it is purely about user experience.
A lot of products are now offering customers tokenised assets without them ever touching crypto. Is that safe?
What is driving the shift is the abstraction layer. Ether is the second largest neobank — they fully rely on infrastructure to buy, sell, trade, and use these assets inside DeFi. Once users obtain these assets they can collateralise them against loans. Revolut is now offering these products inside their application. The user really does not need to know it is crypto underneath if they just want to perform a particular action.
What is the one thing big institutions tend to underestimate when they first look at on-chain markets?
User security and safety. Going back to the fundamental rules of crypto: if you quote a user 1 ETH to 3,000 USDT and at the point of trade it settles at 2,990, those users over time are going to lose trust. What we have seen is a lot of providers simply trusting their API solution — and maybe that API solution inflates the quote just to land the trade. Underneath what we build is full simulation infrastructure, meaning whatever transaction is going to land is exactly what was quoted. A lot of institutions focus on custody and products without understanding that simulation, security audits of all integrations, and contingency plans are what will retain users for the long term.
Connor, thank you so much for joining us.
Thanks for having me.
