Gate Research: The "Wall Street-ization" Wave of Crypto Financial Products – Competition or Convergence?

In January 2009, Satoshi Nakamoto embedded a line of text in the Bitcoin genesis block: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks." This line served as a timestamp and is often interpreted as a critique of the bank bailout system following the 2008 financial crisis: Bitcoin aimed to establish a peer-to-peer value transfer system that doesn't rely on banks or trusted third parties.

However, seventeen years later, one of the mainstream ways to hold Bitcoin is by purchasing shares of an ETF issued by BlackRock, the world's largest asset manager, or holding shares of companies with Bitcoin treasuries. Does this mean the crypto market has deviated from its founding principles? Is Wall Street systematically seizing the rights to issue, price, custody, and distribute crypto financial assets?

1. Is Wall Street Taking Over the Issuance, Pricing, Custody, and Distribution of Crypto Assets?

1.1 The Ideal: Bitcoin's Founding Intention in 2009

This brings us back to Bitcoin's original purpose. The Bitcoin whitepaper outlined a financial order built around three "de-" concepts:

• Decentralization: No central issuer, no headquarters, no server that can be shut down. The ledger is maintained by global nodes, and the rules are written into the code.

• Disintermediation: Value is transferred peer-to-peer, without needing banks, brokers, or clearinghouses for matching and endorsement. "Private key equals ownership," with self-custody as the default.

• Debanking: Anyone can hold and transfer assets, and participate in new coin issuance (via mining), without needing an account, KYC, or accredited investor status.

The core spirit of this ideal was to reclaim the four powers of finance—issuance, pricing, custody, and distribution—from a few institutions and distribute them among every participant in the network. This was both a direct response to the 2008 financial crisis and a declaration: if the centralized financial system fails, build one that doesn't need it.

1.2 The Reality: Are These Four Powers Being Seized?

This decentralized order seemed less pure after the approval of Bitcoin spot ETFs in 2024. In other words, traditional finance is incorporating crypto technology into its own asset issuance, settlement, and distribution systems.

Asset management giants like BlackRock, Fidelity, and Franklin Templeton packaged BTC and ETH into products purchasable in traditional financial accounts. When BTC and ETH were packaged into ETFs, they transformed from "on-chain assets requiring understanding of wallets and private keys" into "financial products purchasable in traditional securities accounts." By May 2026, ETFs held approximately 1.5 million Bitcoin, representing about 7.14% of Bitcoin's total capped supply of 21 million coins in just two years.

Similar changes occurred in the derivatives market. CME's Bitcoin and Ethereum futures and options provide institutions with a regulated venue for hedging and risk management. More and more institutions can gain crypto exposure through futures, options, ETFs, structured products, and fund shares without directly touching on-chain assets.

RWA and tokenized treasuries further push the boundaries of "Wall Street-ization." The RWA treasury market grew from about $380 million in early 2023 to over $11 billion by 2026, the fastest-growing segment in the entire RWA space, with a list of issuers reading like a Wall Street roll call. Products like BlackRock's BUIDL, Franklin Templeton's Benji, JPMorgan's Kinexys, and Ondo's tokenized treasury offerings are all moving traditional financial assets onto the blockchain.

Institutions like Coinbase, Fidelity Digital Assets, and BNY Mellon provide custody, trading, and compliance infrastructure. Furthermore, an executive order in the US in August 2025 allowed alternative assets like cryptocurrencies and private equity into 401(k) retirement plans, opening the door to approximately $12.5 trillion in retirement account funds for crypto assets. As more institutions participate, many brokerages and wealth management firms are also gradually incorporating some distribution rights.

Behind this is not just a change in product form, but a shift in power structure: asset managers handle issuance, brokerages and advisors handle distribution, compliant custodians handle safekeeping, market makers and authorized participants handle primary market subscriptions and redemptions, exchanges handle listing, and the regulatory framework defines the boundaries. Crypto assets thus entered the language system of traditional finance.

2. Two Paths Converging: 1+1>2

But Wall Street's "centralization" is only one side of the coin. Looking from a broader perspective, the other side shows both parties complementing each other's shortcomings. This is not a zero-sum game of one consuming the other, but a two-way convergence of two systems.

The crypto-native system offers permissionless openness, a 24/7 global market, and programmable on-chain settlement. However, it has always lacked four things: compliant issuance channels, institutional-grade custody trust, deep fiat liquidity, and distribution networks reaching the mainstream. These four things are precisely what Wall Street has in abundance.

Conversely, Wall Street has licenses, custody, trillion-dollar capital pools, and global distribution channels, but its assets are trapped in an outdated infrastructure: markets only open on weekdays, high cross-border barriers, T+2 settlement times, and limited ability for products to combine freely. These limitations are exactly what the crypto track can natively solve. Therefore, this 1+1>2 is not just a theoretical deduction.

Recently, crypto exchanges have successively launched real stock trading, presenting two seemingly opposite but ultimately converging directions. One starts from crypto exchanges and moves towards traditional finance; the other starts from traditional finance and moves towards crypto. Gate and Robinhood are the clearest representatives of these two paths.

2.1 Path A: Starting from CEX, Moving Towards Traditional Finance

Gate's TradFi path can be divided into four stages. The first stage is asset tokenization. On July 3, 2025, Gate officially launched the xStocks Trading Section, becoming one of the first crypto exchanges to offer tokenized asset trading. Partnering with xStocks and Ondo, it allows users to directly trade spot and perpetual contracts of US stocks like Apple, Tesla, and Meta using USDT, 24/7, without needing a traditional securities account. The core of this path is the "third-party compliant issuance + CEX distribution" model represented by xStocks. The underlying structure involves a Swiss compliant institution, Backed Finance, holding 1:1 real stocks via an SPV structure (purchased through brokers like Interactive Brokers and custodied at regulated custodian banks like InCore Bank). Tokens are issued on Solana's SPL standard, utilizing Chainlink oracles for high-frequency synchronization with off-chain markets.

The second stage is CFD trading. In January 2026, Gate expanded its TradFi CFD products to cover gold, forex, indices, commodities, and popular stocks, using USDx as an internal USDT-pegged unit for trading experience. At this stage, the exchange acts as a price exposure provider, where users trade derivatives and do not directly hold the underlying stock assets.

The third stage is the launch of real stock trading in June 2026. Gate officially launched real stock trading on June 1, now supporting over 10,000 US stocks and ETFs covering major markets like NYSE and Nasdaq, allowing users to trade directly with USDT. This means a native crypto trading platform is no longer satisfied with providing spot, futures, Launchpad, copy trading, wallet, and on-chain tools for native users but is beginning to include traders of traditional securities like stocks, ETFs, bonds, forex, and funds in its trading landscape.

The key difference from previous CFDs is that Gate emphasizes connecting to real securities markets through compliant brokerage infrastructure, rather than stock tokens or synthetic assets. Gate also announced a strategic partnership with Alpaca on June 3 to expand real stock trading access for eligible users. Alpaca is an SEC-registered clearing broker, with the partnership focusing on trade execution, clearing, and custody infrastructure. In other words, Gate does not issue stocks itself but acts as a front-end portal connecting crypto accounts and stablecoin funds with the traditional broker clearing system.

The fourth stage is geographical expansion. Following the US stock launch, Gate introduced Hong Kong stock trading on June 15, initially covering over 1,000 stocks listed on HKEX, allowing users to trade assets like Tencent, HSBC, Xiaomi, Meituan, BYD, and China Mobile using USDT, sharing the same stock account system as US stocks. On June 22, Gate further launched Korean stock trading, supporting stocks listed on KRX, initially covering the top 1,000 companies by market cap, including Samsung Electronics, SK Hynix, NAVER, Hyundai Motor, and Celltrion, covering both KOSPI and KOSDAQ markets. Timeline-wise, Gate rapidly deployed "US Stocks – HK Stocks – Korean Stocks" within June, forming a multi-market product matrix with USDT as a unified capital entry point and global stocks as allocation targets.

These four stages reflect the changing growth logic of CEXs. Previously, CEXs relied mainly on spot, futures, Launchpad, wealth management, and Web3 wallets to build user ecosystems. However, with increased crypto trading penetration, intensified fee competition, and higher regulatory requirements, the growth space from simply crypto-to-crypto trading is narrowing. Traditional assets like stocks, ETFs, and commodities can expand the tradable asset pool and improve user asset retention. For Gate, real stock trading can serve the cross-asset allocation needs of crypto users and attract traditional finance users into its account system.

2.2 Path B: Starting from Traditional Finance, Moving Towards the Crypto Space

Contrary to Gate's direction, a group of traditional brokerages represented by Robinhood are gradually penetrating the crypto market. These traditional brokerages have the advantage of a mature securities brokerage user base, compliance framework, and retail trading product experience. Therefore, they can integrate traditional financial products like stocks, ETFs, and options with crypto assets on a single trading platform at a lower customer acquisition cost. Traditional financial institutions are not only adding crypto assets as a supplement to their traditional wealth management systems but also leveraging crypto's 24/7 trading and high volatility to explore new revenue streams and enhance platform competitiveness.

The most representative among traditional brokerages is Robinhood. Originally a typical retail brokerage and fintech platform starting with stocks, options, cash management, margin, and subscription services, crypto assets have become one of its growth engines in recent years. In Q4 2024, Robinhood's crypto trading revenue reached $358 million, up over 700% year-over-year, driving total transaction revenue up over 200%. For the full year 2025, Robinhood's total revenue reached $4.5 billion, annual net deposits hit $68 billion, and Gold subscribers reached 4.2 million, showing its transformation from a single stock trading app to a comprehensive financial account.

Robinhood's crypto strategy is not limited to listing coins for trading. In June 2025, Robinhood completed the acquisition of Bitstamp, incorporating Bitstamp's retail and institutional crypto trading business covering the EU, UK, US, and Asia, strengthening its global crypto licenses and institutional business capabilities. This shows Robinhood is not simply treating crypto assets as another trading category in its stock app but is filling gaps in crypto exchange capabilities, licenses, institutional clients, and global operations through acquisitions.

More importantly, it is putting traditional stock assets on-chain. On June 30, 2025, Robinhood announced the launch of Stock Tokens in Europe and disclosed plans to build a Robinhood Layer 2 to support real-world asset tokenization, 24/7 trading, cross-chain functionality, and self-custody. Its stock tokens were initially issued on Arbitrum, with future plans to migrate to Robinhood's own Layer 2 based on the Arbitrum tech stack. These Classic Stock Tokens are derivative contracts with Robinhood reflecting the price performance of related stocks and ETPs.

This contrasts with Gate's emphasis on real stock trading. Robinhood leans more towards packaging traditional stock exposure as on-chain or quasi-on-chain tokenized exposure, while Gate starts from its CEX account to access real securities brokerage infrastructure.

2.3 The Common Goal of Both Paths: Competing for the Next-Generation Integrated Financial Account

For the average user, the financial classification behind an asset might not be that important. Most people don't care whether they are trading stocks, cryptocurrencies, ETFs, event contracts, or tokenized securities. What users truly care about is whether they can trade within the same account, enter and exit positions at low cost, see price changes in real-time, and quickly switch positions during market volatility.

This is precisely the core motivation for traditional brokerages to embrace crypto assets. They are not simply trying to become another Gate or other CEX but hope to prevent the next generation of financial entry points from being taken over by crypto platforms.

Therefore, the key is not whether a particular product succeeds in the short term, but that the direction of industry convergence is already clear: traditional brokerages want the trading speed, global liquidity, younger user base, and high-frequency trading behavior of the crypto market; crypto platforms want the real assets, compliant identity, institutional trust, and broader asset supply of traditional finance.

Both sides are moving closer to each other's most valuable parts. The boundary between Crypto and TradFi is being broken down at the product level. The core of the next stage of competition will be compliance capabilities, asset coverage, capital efficiency, user experience, and global account systems.

3. RWA and On-Chain Treasuries: The Middle Layer Unifying Capital Markets

Gate and Robinhood mentioned above represent the convergence at the user entry point, while RWA and on-chain treasuries represent the convergence at the asset layer.

In the past, one of the biggest problems in the crypto market was the relatively closed supply of on-chain assets. Besides native tokens, stablecoins, NFTs, and a few derivative assets, the blockchain struggled to host sufficiently rich, low-volatility, and institutionally-suitable real-world yield-bearing assets.

On-chain treasuries changed this. When US Treasuries, money market funds, and short-term bond funds are tokenized, they become on-chain approximations of "risk-free returns." They can serve as collateral, participate in DeFi protocols, service institutional treasury management, and become the underlying yield source for stablecoins and on-chain financial products.

However, this market is still in its early stages. Data from May 2026 shows the tokenized US Treasury market is around $15 billion, while the entire US Treasury market is about $30 trillion. The gap is more than three orders of magnitude.

This gap indicates two things. First, RWA is not a completed market but one that has just begun to become institutionalized. Second, its ceiling is not determined by crypto-native users but by whether traditional financial assets can enter the on-chain environment in a compliant, auditable, settleable, and distributable manner. This is why traditional institutions like JPMorgan, BlackRock, Franklin Templeton, BNY, DTCC, and Nasdaq are simultaneously appearing in the tokenization narrative. In the long run, they are not just creating separate crypto products but are testing the underlying settlement and asset registration methods for future capital markets.

Data proves this convergence is not a narrative bubble but a real structural trend. In the first half of 2026, while the overall crypto market declined by 28% and DeFi TVL shrank by over 25%, the RWA sector bucked the trend, growing over 40% and surpassing $32 billion. Tokenized stocks were the growth engine: the number of holding wallets grew by 188% in six months to about 350,000, making them the largest RWA category by wallet count, surpassing tokenized gold. This means a large number of users originally in the crypto world seeking US stock exposure found an entry point without returning to traditional brokerages. Meanwhile, DTCC and banks in the US and Japan plan to enter the market in 2026-2027, aiming to "infrastructuralize" tokenized stocks.

4. The Logical Endpoint: Stocks, Crypto, RWA, and On-Chain Treasuries Trading on the Same Platform

4.1 Unified Capital Market and the "Super Account"

In the old financial system, different assets were segregated in different accounts: stocks in brokerage accounts, funds in asset management accounts, bonds in institutional systems, deposits in bank accounts, crypto on exchanges or wallets, and on-chain assets in self-custody addresses. Each asset type had its own trading hours, settlement cycles, custody rules, compliance requirements, and user interfaces. But a new generation of platforms is trying to compress this fragmentation into a single account.

Crypto exchanges start from coins and expand into stocks, ETFs, RWAs, payments, and on-chain yields. Traditional brokerages start from stocks and expand into crypto, tokenized securities, prediction markets, stablecoins, and 24/7 trading. Asset managers start from funds and expand into ETFs, tokenized funds, and on-chain distribution. Banks start from deposits and settlement and expand into tokenized deposits, on-chain payments, and institutional clearing networks.

Superficially, they are making different products. In reality, they are all competing