Equity Tokenization: New Opportunities in the Primary Market

Beyond the hype of stablecoins, equity tokenization is gradually becoming the new focus of the market. Some Web3 startups are attempting to solve a long-standing issue: why do the early growth dividends of top private companies only belong to institutions and super-rich individuals? Their proposed solution is to leverage blockchain technology to reconstruct participation methods, converting the private equity of unlisted companies into asset-backed Tokens, allowing ordinary investors to participate in the growth of star enterprises like SpaceX and Stripe with a lower threshold.

This practice packages alternative asset classes that originally existed only in the venture capital circle and among high-net-worth individuals into blockchain assets, opening up new horizons on the chain.

Private Equity Tokenization: A New Frontier for Asset On-Chain

The private equity market is undoubtedly one of the most representative asset islands of our time. Data shows that some top private companies have quite considerable returns. From the beginning of 2021 to the first quarter of 2025, a certain index accumulated a rise of 81%, far exceeding the 51% of the Nasdaq 100 index during the same period. Even in the context of an overall market decline in the first quarter of 2025, with the Nasdaq dropping by 9%, these leading private companies still rose by 13% against the trend. This not only reflects the fundamental strength of these companies but also highlights their significant growth potential before the IPO.

However, this "value capture window" has long been open only to a select few. For most retail investors, an asset market with an average trade size exceeding $3 million, complex structures, and a lack of public liquidity is completely in the "wait-and-see zone." Furthermore, the exit paths for these companies are not limited to IPOs; mergers and acquisitions have become one of the more mainstream options, further raising the participation threshold for retail investors.

Private equity tokenization was created to break this structural inequality. It transforms the originally high-threshold, low-liquidity, and complex opaque private equity into on-chain native assets, significantly lowering the entry threshold from a $3 million ticket to $10; it turns lengthy and complex special purpose entity agreements into on-chain smart contracts; at the same time, it enhances liquidity, allowing assets that were originally locked for long periods to possibly be priced around the clock.

Bring the "Capital Feast" of the Primary Market into Everyone's Digital Wallet

Multiple platforms are exploring this field, aiming to break down the walls of the traditional financial world and make Pre-IPO assets, which are exclusively available to high-net-worth individuals, accessible as public investment products for global users. The vision of these platforms is to eliminate restrictions on investment due to capital thresholds, geographical barriers, or regulatory labels, redistributing financial opportunities to the general public.

The operating mechanism of these platforms usually involves the platform completing the real equity acquisition of the target company first, and then linking this portion of rights on-chain in the form of tokens at a 1:1 ratio. This is not merely a mapping of securities, but a substantial transfer of economic rights. More importantly, the total issuance of all tokens, circulation paths, and holding information are all transparently recorded on-chain, open for any user to verify in real time.

At the same time, these platforms are also committed to simplifying the investment process, allowing users to build their own Pre-IPO investment portfolios with a low threshold using only credit cards or stablecoins. The complex risk control and compliance processes behind the scenes are "invisible" to users.

In this model, the price of the Token is highly correlated with the company's valuation, and users' returns come from the growth curve of real enterprises rather than the platform's empty narratives. This structure not only enhances the authenticity of investments but also bridges the long-controlled profit channels between retail investors and the Primary Market at the mechanism level.

Summary

The rise of private equity tokenization signifies that the Primary Market is entering a new stage of structural transformation driven by blockchain technology. However, this path still faces many practical challenges. While it may reshape the access rules, it is difficult to immediately break down the deep-seated structural barriers between retail investors and institutions. The tokenization of physical assets is not a "universal key," but rather a long-term game concerning trust, transparency, and institutional reconstruction; the real test has only just begun.