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Author: Nancy, PANews

In just over a year, the tokenized stock market has experienced explosive growth, with daily trading volume rising from zero to nearly $4 billion, continuously setting new volume highs, and the easing of U.S. regulation is expected to push this sector toward mainstream adoption.

Beyond direct tokenization of equity, from Hyperliquid's pioneering on-chain pricing of private companies via perpetual contracts to Polymarket's partnership with Nasdaq to launch prediction markets for private firms, the discovery of valuation and liquidity capture for Pre‑IPO assets is also unfolding comprehensively in the on‑chain world.

Polymarket partners with Nasdaq, prediction market makes its first foray into the Pre-IPO arena

May 19, Polymarket announced an exclusive partnership with Nasdaq, officially launching a prediction market linked to private company performance, the first time prediction markets have entered the private market sector.

Based on the collaboration, users will be able to place predictive trades in the future around metrics such as company valuation, IPO timing, and secondary market trading activity, while Nasdaq Private Market will serve as the exclusive settlement data provider for the related contracts, responsible for supplying the official data used to determine outcomes.

It is worth noting that this is also the first time Nasdaq Private Market has made some private market valuation data publicly available for free. In the past, such data was typically only available to institutional clients and required a paid subscription to access.

The introduction of prediction markets enables more users to engage in price speculation, sentiment expression, and expectation trading around these hot private companies. Previously, most star tech firms often completed the bulk of their valuation growth before going public, but ordinary users typically lacked channels to participate. According to Nasdaq data, there are now over 1,600 unicorn companies worldwide with valuations exceeding $1 billion, including OpenAI, Anthropic, SpaceX, etc., with a total combined valuation of over $5 trillion.

Of course, prediction markets can also provide real-time market pricing and sentiment feedback for these pre-IPO assets, thereby creating a more dynamic valuation reference and further enhancing the transparency of information flow and price discovery in private markets.

For Polymarket, this partnership not only drives business expansion but also accelerates its transition to mainstream financial infrastructure. Although competitor Kalshi has also launched prediction contracts related to private-company IPOs, its settlements rely more on SEC filings, company announcements and other public information, which entails some lag and interpretive leeway. In contrast, Polymarket directly incorporates authoritative Nasdaq data as the settlement basis, significantly enhancing market credibility and the objectivity of outcomes.

More importantly, the launch of private‑market‑related products also helps Polymarket further expand its business into the traditional finance sector, attracting more global users and no longer being limited to its original segments such as politics, sports, and crypto assets.

For Nasdaq, this partnership also holds strategic significance. By opening private company data to the on-chain market, Nasdaq can not only capture valuation discovery and liquidity demand in the Pre‑IPO market, but also extend its data capabilities to global retail and crypto user bases, expanding the influence and monetization potential of its data products. Moreover, as crypto platforms such as Hyperliquid emerge, Nasdaq’s proactive embrace of the on-chain financial ecosystem also strengthens its resilience against emerging competition.

Early price discovery, Hyperliquid challenges Wall Street's pricing power

Compared with prediction markets, the leading Prep DEX Hyperliquid has begun to lever the pricing power long held by Wall Street.

Months ago, Hyperliquid's HIP-3 market began bringing traditional financial assets such as silver, gold, and crude oil onto the blockchain, gradually becoming an important price‑discovery market during weekends and U.S. stock‑market closures, drawing attention from the traditional finance sector. In April alone, the daily trading volume of oil‑related contracts on the Hyperliquid platform exceeded $700 million.

Recently, Hyperliquid has further extended its battle into the Pre-IPO space, launching perpetual contracts for Cerebras (CBRS) and SpaceX (SPCX). Among them, the CBRS contract's on-chain price was anchored within 3% of the Nasdaq opening price before the company’s official listing, whereas traditional secondary platforms showed a deviation of up to 35%. This indicates that Hyperliquid, to some extent, is the first to achieve price discovery for Pre-IPO assets on-chain, beginning to challenge the pricing authority long dominated by traditional secondary markets, investment banks, and private placement trades.

Based on the data, the Hyperliquid HIP-3 market's 7‑day trading volume is about $17.58 billion, with open interest around $2.54 billion. To lower the entry barrier, Hyperliquid recently updated the HIP-3 documentation, gradually reducing the hard staking requirement of 500,000 HYPE for deploying perpetual markets; amounts exceeding the new threshold can be unlocked. This is expected to attract more builders, further driving the expansion of on‑chain financial assets.

As Hyperliquid's influence in traditional financial assets and the pre‑IPO market continues to expand, a sense of crisis on Wall Street is also heating up. Recently, the CME and NYSE have begun urging U.S. regulators to strengthen scrutiny of Hyperliquid, citing potential market manipulation risks and sanction‑evasion issues.

Facing regulatory uncertainty, Hyperliquid is also accelerating its compliance development. In addition to the Hyperliquid Foundation donating 1 million HYPE tokens to the lobbying organization Hyperliquid Policy Center, with veteran crypto policy lawyer Jake Chervinsky leading regulatory outreach, Hyperliquid co‑founder Jeff personally traveled to Washington to engage regulators, hoping to bring the on‑chain derivatives market under the U.S. regulatory framework. Moreover, Hyperliquid has hired veteran public‑relations expert George Godsal as its spokesperson, emphasizing that all trades, liquidations and funding rates on the platform are publicly verifiable, offering transparency far higher than traditional markets.

In the future, as more Pre-IPO assets migrate to on-chain markets, the Wall Street‑dominated valuation system and price discovery mechanisms are rapidly facing a direct challenge from the native crypto market.

Daily trading volume hits new high, SEC may issue a new exemption this week

Tokenized stocks are rapidly moving from crypto-native innovation to mainstream adoption, and major traditional exchanges such as the NYSE and Nasdaq have already begun actively positioning themselves in this space.

The Block data shows that as of May 18, the daily trading volume of tokenized stocks hit a record high of $3.57 billion. Most of the volume is concentrated on the two major platforms Binance and Hyperliquid, while platforms such as xStocks, Ondo, and Bitget continue to drive the expansion of the on-chain stock market.

At the same time, the loosening of U.S. regulatory policies could also serve as a catalyst for further growth in the tokenized stock sector. According to recent Bloomberg reporting, sources said, the U.S. SEC could roll out innovative exemption rules for tokenized stocks as early as this week, establishing a new regulatory framework for crypto versions of publicly listed company shares.

Based on the information currently disclosed, the SEC is inclined to allow third‑party entities to issue tokens linked to stock prices without official authorization from the listed companies, and to permit their trading on DeFi platforms. This means that a more open on‑chain synthetic asset ecosystem for tokenized equities will gradually take shape in the future.

Previously, because some projects launched related tokens without the company's authorization, the market has seen repeated controversy. For example, Anthropic publicly warned that unauthorized tokenized equity exposures do not have real equity effect, which once sparked market panic.

Essentially, these third‑party‑issued tokenized stocks are more akin to synthetic assets that track stock prices rather than true ownership of the underlying equities. Some products may not confer the voting rights, dividend rights, and other entitlements associated with traditional shares. According to the SEC's currently discussed framework, if a platform cannot provide users with the corresponding rights protections, it may lose eligibility to list such token products.

The innovative exemption rules for tokenized stocks are also seen by observers as the first large‑scale test by U.S. regulators of the feasibility of moving stock trading onto crypto infrastructure. Proponents argue that tokenized securities can enable near‑real‑time settlement, 7×24 hour trading, and lower global access thresholds, thereby significantly improving capital market efficiency; opponents contend that the related mechanisms could weaken KYC, anti‑money‑laundering, and investor protection frameworks, and increase systemic market risk.

Facing the rise of tokenized stocks, ARK researcher Lorenzo Valente warned that the market’s widespread use of second‑ and third‑layer SPV packaging structures may become a core risk for the future development of tokenized stocks. He believes that Bullish’s acquisition of Equiniti, along with institutions such as Securitize promoting the on‑chain tokenization of real, compliant stock equity, is key to whether tokenized stocks can truly enter the institutional market. In the future, the market may still see a large number of packaged products, including equity SPVs, debt notes, and other derivative structures. If the underlying rights, transfer restrictions, and investor rights are unclear, tokenized stocks could become speculative assets wrapped in multiple layers.