On-chain purchases of US stock tokens see a 30% drop after market close; cross-exchange spreads, net of all fees, yield no profit.

The total market capitalization of tokenized stock spot has surpassed $3 billion, but Hyperliquid's order book depth contracted by approximately 33% following US market closure; cross-platform arbitrage yields no profit after accounting for spread and slippage costs, even on a $1,000 trade.

Author: Cooper Duschang, Coin Metrics (Talos)

Compiled by: TechFlow

TechFlow Summary:The total spot market capitalization of tokenized US stocks has exceeded $3 billion, emerging as a new channel for on-chain capital to allocate to traditional equity assets. However, recent research by Coin Metrics indicates that compared to the $12.3 billion in weekly stock perpetual contract volume on Hyperliquid, the spot market remains in its early stages.

Data further reveals that although tokenized stocks support round-the-clock quoting, they are highly reliant on liquidity anchoring from the underlying stock. Once trading hours close and during weekends, the core platform's order book depth within a 1% band shrinks significantly by 19% to 33%. After accounting for bid-ask spreads and slippage, cross-exchange arbitrage spreads become unprofitable.

Key Takeaways

• The total market cap of tokenized stocks has grown to over $3 billion. Investors can directly gain exposure to US equity prices on-chain through multiple issuers such as xStocks, Ondo Tokenized Stocks, and bStocks.
• During regular US market trading hours, NVDAx traded at a premium above the underlying NVDA price 58.6% of the time, with an average premium of 3.1 basis points; meanwhile, NVDAon traded at a premium 88.9% of the time, averaging 14.1 basis points.
• Execution prices for tokenized stocks vary significantly across platforms and order sizes. A particular tokenized stock might offer the lowest slippage for a $10k order on one platform but not be optimal for a $100k order. Therefore, slippage depth and asset coverage must be evaluated simultaneously using cross-platform data.

Introduction

Between October 27 and November 2, various trading platforms recorded over $2 billion in transaction volume in the tokenized stock spot market. As on-chain allocation demand continues to grow, custodians have steadily increased their holdings of underlying equities and issued more tokens, driving the total market cap of tokenized stocks above $3 billion.

Chart: Cumulative spot market cap trend of tokenized stocks (xStocks), Data source: Talos CM Network Data Pro

Although the market cap of tokenized stocks has steadily climbed to approximately $3 billion, its spot trading volume remains comparatively small against its corresponding equity perpetual contracts. Over the past week, stock perpetual contract volume on Hyperliquid was approximately $12.3 billion, equivalent to six times the total transaction volume ($2 billion) of the tokenized stock spot market.

Chart: 7-day average daily volume comparison of tokenized stocks (comparing Hyperliquid HIP-3 equity perpetual contracts to equity spot), Data source: Talos CM Market Data Pro

In this issue's State of the Network research report, we will conduct an in-depth analysis of the pricing performance of tokenized stocks relative to their underlying equities, spread dynamics during after-hours and pre-market sessions, and the current market fragmentation of these assets across different trading platforms.

Comparison of Tokenized Stocks vs. Underlying Equities

Tokenized stocks are typically issued for non-US investors, providing them with on-chain exposure to US equity prices outside of regular trading hours. These tokens are issued by specific entities and generally backed by underlying shares held through licensed custodians.

Because tokenized stocks trade in a 24/7 year-round market, continuous quoting on-chain remains possible even when traditional financial markets are closed.

Chart: 24-hour reference price comparison of NVDAx and NVDAon vs. NVDA underlying stock 5-minute price action (gray shading indicates weekends or US market holidays), Data sources: Talos CM Market Data Pro, Yahoo Finance

Currently, only whitelisted users are eligible to mint new tokens and redeem underlying equities. This mechanism creates potential redemption premium/discount risks for ordinary holders who do not possess the same redemption privileges.

From October 27 to November 2, NVDAx issued by xStocks traded at a premium during 58.6% of US market opening hours, averaging 3.1 basis points; while NVDAon issued by Ondo Stocks traded at a premium during 88.9% of opening hours, with an average premium reaching 14.1 basis points. During broader market selloffs, tokenized NVDA also dipped below Friday's closing price.

Chart: Average premium rate comparison of NVDAx vs. NVDA underlying equity across various trading platforms (US market open vs. closed hours), Data source: Talos CM Market Data Pro

Fragmentation and liquidity splits across trading platforms cause the same tokenized stock to exhibit price discrepancies across different venues during both open and closed US market hours. During the observation period, NVDAx on Kraken averaged a slight discount of -0.9 basis points relative to the NVDA underlying equity during US market open hours.

Through lead-lag analysis, we compared NVDAx's price volatility during US market closures against NVDA's actual next-day opening gap across 210 trading days since January 2026, focusing on the following time windows:

• After-hours session (16:00–20:00 ET): Correlation between evening token volatility and NVDA's actual next-day opening price is extremely weak, with an R² of only 0.24. Shortly after US market close, the token itself carries almost no effective forward-looking signals regarding next-day direction.
• Overnight session (20:00–04:00 ET): Overnight volatility shows similarly weak correlation with the next-day open (R² = 0.30), though slightly stronger than after-hours, with correlation gradually increasing as it approaches the US pre-market.
• Pre-market session (04:00–09:29 ET): NVDAx prices steadily converge toward NVDA's final actual opening price, with linear regression R² climbing further to 0.42.
• Full overnight cycle (16:00–09:30 ET next day): Across the entire US market closure period, token price action almost completely synchronizes with the underlying equity, achieving an R² of 0.98. By the time US markets open, NVDAx has fully converged to the target stock's true price as expected.

The alignment between tokenized prices and real equities at the opening node is extremely tight, but this price convergence primarily completes gradually during the pre-market session. Relying solely on after-hours volatility makes it nearly impossible to effectively predict next-day actual opening performance.

Chart: Correlation regression distribution of NVDAx vs. NVDA actual opening gap across after-hours, overnight, pre-market, and near-open sessions, Data sources: Talos CM Market Data Pro, Yahoo Finance

Tokenized stocks are highly sensitive to trade impact, a phenomenon particularly pronounced during US market closure periods. When US markets are closed, order book liquidity within a 1% mid-price band for NVDAx on Bybit and MEXC drops by an average of 19%; meanwhile, Hyperliquid sees its order book depth within the same 1% band shrink by approximately 33%.

Buy and sell orders executed under this sudden liquidity drop further exacerbate pricing misalignment for the same NVDAx token across different markets, which only gradually stabilizes once US equities resume trading.

Chart: Comparison of average buy-side slippage for $10k and $100k order executions of NVDAx across trading platforms (log scale, gray area denotes closed hours), Data source: Talos CM Market Data Pro

When Are Tokenized Stocks Typically Traded?

Tokenized stocks provide non-US investors with access to US equity prices. Observing intraday trading distribution helps reveal whether investors continue to participate during low-liquidity closed hours.

Chart: Heatmap of NVDAx trading volume by day of week and ET hour across 7 spot markets (median $36k, peak first hour post-open $225k), Data source: Talos CM Market Data Pro

Statistical results show that NVDA xStocks trading activity concentrates mainly around US market opens and closes. During the core open window on weekdays from 9:00 to 10:00 ET, NVDAx averages $225k in hourly volume.

Surrounding open expectations and after-hours news events, there is also notable trading activity during pre-market and after-hours sessions. Although current data cannot definitively pinpoint traders' geographic locations, the offshore exchange landscape supporting these pairs suggests that despite dominant participation from international non-US users, their actual trading habits closely follow traditional US equity sessions.

Cross-Platform Execution Costs and Performance

Since prices and depth for the same tokenized stock vary across platforms, the actual trading cost for investors seeking risk exposure largely depends on where the order is executed.

Chart: Distribution of xStock trading platforms with the lowest hourly costs across different order sizes ($1k, $10k, $100k) over the past 7 days (weekend shading indicates US market closure), Data source: Talos CM Market Data Pro

For smaller order sizes, a relatively wide range of platforms can handle execution. Between October 27 and November 2, for $1k orders, Bybit and Hyperliquid offered the lowest slippage 58% and 23% of the time, respectively; when order size increases to $100k, Bybit or Hyperliquid emerges as the optimal execution platform 98.2% of the time.

Chart: Hourly optimal execution cost (bps) and winning issuer comparison for xStock, Ondo, and bStock under $10k order size, Data source: Talos CM Market Data Pro

A cross-comparison of different tokenized variants reveals that asset execution costs diverge depending on the issuing entity. During the October 27 to November 2 period, for $10k trades, NVDAb on Binance recorded the lowest execution slippage among all NVDA tokenized variants, ranking as the most cost-effective option 96% of the observed time.

Does Arbitrage Spread Opportunity Still Exist After Transaction Costs?

Although quote differences across trading platforms for various tokenized stock variants appear to create arbitrage opportunities, actual strategy execution requires fully accounting for liquidity constraints and transaction friction costs.

Data from June 2026 to November 2 shows that even with small $1k orders, and before deducting platform trading fees, the combined average market bid-ask spread and two-way entry/exit slippage entirely exceeds the observed cross-platform spread magnitude.

Chart: Comparison of spread returns vs. entry/exit slippage under $1k notional principal (Left: Cross-issuer Long Hyperliquid NVDAx / Short Binance NVDAb; Right: Cross-exchange Long Hyperliquid NVDAx / Short Kraken NVDAx), Data source: Talos CM Market Data Pro

Conclusion

Tokenized stocks have established a 24/7 on-chain pricing channel for traditional fixed-session equity assets targeting non-US investors. However, at their current stage of development, these tokenized assets remain heavily concentrated in trading during traditional US market hours, making them highly susceptible to significant liquidity contraction shocks once closed hours begin.

Systematically collecting order book depth, execution slippage, and reference pricing data for tokenized assets enables trading teams to more objectively and accurately cross-evaluate the true execution costs across different equity token variants and trading venues.

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