A New Loophole Just Proved You Don’t Actually Own Your Shares – But the Fix Is Already Live on Solana

An Analysis of Superstate’s Direct Issuance of SEC-Registered Shares on Blockchain Platforms

The recent initiative by Superstate, a transfer agent duly registered with the Securities and Exchange Commission (SEC), to facilitate the direct issuance of SEC-registered shares on prominent blockchain platforms such as Ethereum and Solana marks a significant evolution in the landscape of capital markets. This innovation enables primary sales to be settled in stablecoins, while ownership is meticulously recorded on a transfer agent’s ledger, which recognizes the blockchain as the master file for all ownership records.

Overview of Direct Issuance Programs

Superstate’s Direct Issuance Programs empower issuers to distribute tokens that encapsulate the same legal equity rights typically associated with traditional stock—specifically voting and dividend entitlements. These tokens are transacted in stablecoins and allocated to Know Your Customer (KYC) verified wallets at real-time market prices.

This paradigm shift strategically reallocates elements of the issuance workflow from a solely DTCC-centric infrastructure towards more decentralized public blockchain ecosystems, all while maintaining compliance with transfer agent oversight and pertinent securities regulations.

Implementation Case Study: Galaxy Digital

The first practical implementation of this initiative is exemplified by Galaxy Digital, which successfully tokenized its SEC-registered common stock on Solana through Superstate’s platform. As reported on Galaxy’s investor website, a total of 32,374 GLXY shares were tokenized by early September 2025. This development sets a precedent for constructing on-chain capitalization tables that are synchronized with the records maintained by a registered transfer agent.

The implications of this model extend to governance and corporate actions; each sanctioned transfer updates beneficial ownership records in the registered transfer agent’s books. Furthermore, corporate actions such as dividend distributions or stock splits can be executed seamlessly through smart contracts managed by the transfer agent.

A staff FAQ released by the SEC in May 2025 acknowledged that blockchains could function as the official Master Securityholder File for registered transfer agents. This recognition, as outlined in a summary by Simpson Thacher, provides a regulatory framework supporting these innovative capitalization models.

Distribution Strategies: Transitioning from Issuance to Trading

In alignment with these advancements, Backpack Exchange has announced its intention to list SEC-registered, natively tokenized U.S. equities via an integration with Superstate. This initiative marks an initial focus on non-U.S. investor access while simultaneously pursuing pathways for U.S.-based broker-dealer and Alternative Trading System (ATS) participation.

The proposed venue model envisages KYC-compliant wallets and whitelisted order flows serving as conduits for investors, devoid of synthetic wrappers or Special Purpose Vehicle (SPV) constructs. This distinction is particularly salient for 2025, especially following previous instances where marketing efforts surrounding tokenized stocks generated misunderstandings regarding on-chain exposures versus actual registered equity, as highlighted by Business Insider in relation to synthetic offerings.

Competitive Dynamics in Capital Table Management

The competitive landscape is increasingly defined by who controls both the capitalization tables and order books. If the combination of the transfer agent and blockchain technology emerges as the definitive source of ownership records for KYC-compliant wallets, it provides a foundation from which distribution and secondary trading can be channeled through a variety of compliant venues that integrate with this ledger system.

• Broker-dealers and ATSs will engage in competition with wallet-native platforms and whitelisted Automated Market Makers (AMMs) that leverage direct connections to transfer agent functionalities.
• The SEC has yet to delineate a specific regulatory pathway for AMMs trading National Market System (NMS) securities; any AMM facilitating orders in NMS securities must adhere to extant regulatory frameworks such as Regulation ATS, fair access mandates, surveillance requirements, and short-sale regulations.
• Regulatory statements have consistently underscored that tokenization does not circumvent established market integrity rules.

Infrastructure Development: Connecting New Paradigms

In tandem with these developments, the Depository Trust & Clearing Corporation (DTCC) has launched a tokenized collateral management platform and has briefed the SEC’s Crypto Task Force regarding potential tokenization services that could integrate into pledging processes and corporate action workflows. This information is substantiated through publicly available DTCC materials and SEC disclosures.

Moreover, Nasdaq has filed to facilitate tokenized securities trading within its primary market contingent upon equivalency in rights, with an anticipated timeline for implementation as early as Q3 2026, contingent upon readiness of DTC infrastructure.

The trajectory indicates an evolving hybrid model wherein DTC-eligible positions coalesce with on-chain capitalization entries. This integration may allow issuers seeking broader distribution to leverage this bridge for street-name positions while simultaneously operating primary issuance channels on-chain utilizing stablecoin transactions.

Revolutionizing Ownership Models

The issuance workflow is poised for significant transformation through Superstate’s Direct Issuance, which enables companies to directly raise capital for wallets, accept proceeds in stablecoins, and record new ownership on-chain under vigilant oversight from the transfer agent. Notably:

• Follow-on offerings and at-the-market programs can now operate outside traditional market hours, achieving T≈0 settlement times alongside programmable constraints such as transfer restrictions or on-chain accreditation verifications.
• This advancement may broaden addressable demand among small and mid-cap issuers across non-U.S. time zones once compliant venues, KYC channels, and custodial solutions become operational.
• The custody model evolves from an omnibus street name structure typically employed by brokers to one characterized by wallet-native beneficial ownership directly linked to the transfer agent’s ledger—all subject to requisite whitelisting and rescission authorities necessary for regulatory compliance.

Constraints on Secondary Trading Systems

Backpack’s strategy underscores a centralized access point for tokenized equities outside U.S. markets; however, domestic flows remain contingent upon broker-dealer and ATS permissions concerning tokens that represent actual securities.

While AMMs present technically simple solutions within blockchain ecosystems, their regulatory status concerning NMS remains ambiguous. The potential outcomes shaping 2026 are framed as follows:

• Whitelisted AMMs recognized as ATSs facilitating compliance.
• AMMs facing restrictions while centralized order books maintain dominance.
• A hybrid model where AMMs operate for non-NMS or smaller issuers while central limit order books continue handling NMS transactions exclusively.

The SEC’s current stance underscores that tokenization initiatives must operate within established regulatory confines rather than create entirely new frameworks.

The Expanded Role of Registered Transfer Agents

The enhanced responsibilities assigned to registered transfer agents emerge as critical facilitators within this ecosystem. With blockchain technology serving as the master securityholder file, these agents will oversee whitelist management, error correction processes, rescission protocols, and audit trails concerning on-chain transfers. Consequently:

• Registered transfer agents will play pivotal roles at chokepoints associated with corporate actions and governance processes.
• Wallets and venues equipped with robust KYC protocols will become essential distribution partners capable of supplying clean data back into the master file.
• This framework also presents significant opportunities for stablecoin issuers who can capitalize on primary settlement volumes while custodians adapt their operations to accommodate direct holding of tokens or structured wallet architectures compliant with Rule 15c3-3 custody expectations when brokers are involved.

The Interplay Between Tokenized Shares and DTC Positions

A critical consideration for issuers centers around how tokenized shares will interact with existing DTC positions. Initially focusing on collateral applications within DTCC’s tokenization programs lays foundational groundwork before extending into broader securities workflows. Nasdaq’s filing presumes readiness of DTC infrastructure before integrated trading involving token-settled trades occurs within shared order books.

Until seamless conversion pathways are operationalized, many issuers may find it prudent to navigate parallel channels—utilizing DTC systems for mainstream exchange trading while leveraging on-chain issuance mechanisms for targeted capital formation initiatives or controlled secondary market transactions between whitelisted wallets.

The timing associated with establishing this bridge will ultimately dictate how swiftly on-chain liquidity can achieve parity with traditional street-name liquidity frameworks.

Key Metrics for Monitoring Market Evolution

The following metrics will serve as critical indicators in assessing market dynamics:

• The number of issuers participating in Superstate’s Opening Bell stack.
• The volume of shares outstanding that transition into token-enabled formats.
• The number of holders accounted for on the blockchain master file maintained by Superstate as a registered transfer agent.
• The monthly volume of primary issuance settling in stablecoins.
• The transaction volumes routed through Backpack and other compliant venues specializing in tokenized equities—particularly in non-U.S. markets.
• The scalability metrics associated with DTCC’s tokenized collateral network alongside testing phases related to DTC conversion or corporate action bridges involving tokenized equity instruments.

Conclusion: A Hybrid Market Structure Ahead

The developments leading into 2026 are contingent upon public milestones alongside existing market infrastructures. Galaxy Digital’s successful tokenization illustrates that issuers can indeed release authentic shares on-chain under controlled oversight from registered transfer agents. The introduction of Superstate’s Direct Issuance facilitates innovative wallet-native primary offerings backed by stablecoin transactions—positioning them favorably within evolving market paradigms.

If DTCC and Nasdaq meet their articulated timelines, there exists potential for visibility regarding token legs within mainstream market operations by late 2026—provided infrastructural synergies are achieved. The SEC staff has indicated openness toward integrating blockchain-based master files while broader secondary trading permissions remain under evaluation.

This points towards a hybrid market structure throughout 2026 characterized by stablecoin settlements, KYC-compliant wallets, and registered transfer agents anchoring capitalization tables amidst competing venues striving to control order flow dynamics atop these emerging frameworks.

This evolving landscape presents issuers, registered transfer agents, trading venues, and infrastructure providers with viable pathways toward migrating SEC-registered shares from traditional DTCC-centric rails into modern public blockchain environments.