Tokenized Stock Trading Jumps 288% in July, Fueled by QQQB Token

In July, the trading of tokenized stocks skyrocketed by 288%, reaching an unprecedented $11.3 billion, largely due to one specific token tied to the QQQ ETF.

Without QQQB, Tokenized Equity Volume Would Have Dipped

Had it not been for the QQQB token, the total volume for tokenized equities would have been approximately $2.03 billion, marking a decline of around 30% compared to June's figures.

According to data from CoinDesk, Binance's tokenized stocks, known as bStocks, contributed $9.41 billion to the overall volume, which represents 83.3% of the total. The QQQB token, which tracks Invesco’s QQQ ETF, alone accounted for $9.27 billion, or about 82% of all tokenized equity trading.

When excluding the QQQB token, the tokenized trading volume in July was roughly $2.03 billion, down about 30% from the previous month’s estimated total of $2.91 billion. The volume for xStocks plummeted to $335 million from $1.55 billion, while Ondo and Backpack reported $792 million and $479 million, respectively.

The QQQB token was launched on Binance on June 30, with zero maker fees available until August 31. Additionally, on July 23, Binance introduced a VIP volume multiplier program, allowing certain users to count stock and bStocks volume at three times its traded value, although this multiplier does not affect the actual trading volume.

During July, the underlying Invesco QQQ Trust experienced a 6.6% drop, contrasting with a 3.2% decrease in the Nasdaq Composite and a slight 0.1% fall in the S&P 500. The QQQ saw a decline as much as 10.2% below its closing price on June 30 before recovering in the last two days of the month.

The volatility was driven significantly by AI and semiconductor stocks. The iShares Semiconductor ETF faced a steep 22.1% decline, marking its worst performance since December 2002, while Micron's stock dropped by 28.7%. The heightened trading activity for the QQQ ETF was attributed to the volatility in AI-related stocks, the Federal Open Market Committee (FOMC) meeting, and earnings reports from major tech companies.

One of the appealing aspects of these tokenized equities is their round-the-clock trading capability, allowing users outside the U.S. to trade even when U.S. markets are closed, and providing access in regions where direct brokerage services for U.S. securities may be limited.