🔍A big win for tokenization

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Apyx is the first dividend-backed stablecoin protocol. Check it out here!

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GM friends.

Here’s what I’ll cover today:

🔎Tokenized Stocks are getting regulatory clarity

📊 Crypto chart of the week

🗞️ The latest DeFi news

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🔎Tokenized Stocks finally get regulatory clarity

One of the most bullish regulatory announcements in a while dropped this week.

According to Bloomberg, the SEC is reportedly planning to introduce an “innovation exemption” that would officially allow US users to access tokenized stocks.

I think this could have a major positive impact on DeFi and attract significant capital to the industry in the long run, which is why I wanted to cover it today.

Why legalizing tokenized stocks is a big deal

On-chain stocks already exist. Several platforms, including Ondo Finance and xStocks, offer tokenized equities with deep liquidity.

But there’s one major issue:

They mostly operate in a regulatory grey area and are restricted to non-US residents.

This is one of the reasons why I think they haven’t gained significant traction yet.

For now, holding stocks in a TradFi brokerage account simply makes more sense for most investors. It comes with lower regulatory risk and clearer investor protections.

But the SEC’s proposed innovation exemption could change that.

Once regulatory clarity arrives, the value proposition of tokenized stocks becomes much clearer in my opinion, as tokenization can offer major advantages.

For example, DeFi’s composability enables an unparalleled level of capital efficiency.

In DeFi, you could use your stocks and ETFs to borrow stablecoins against them, provide them as liquidity to generate a yield, trade them 24/7, not only during the stock market operating hours, and do all of this while paying lower fees.

Meanwhile, most of these use cases are still either unavailable, limited, or impractical on traditional brokerage exchanges. TradFi is simply much less capital efficient.

That’s why I think the demand for tokenized stocks and ETFs could be massive once the regulatory uncertainty is removed.

Which DeFi projects could benefit from the SEC’s innovation exemption for on-chain stocks?

I already made a short X post about this, but I think it’s worth diving deeper.

The most obvious beneficiaries would be the issuers of tokenized stocks. Right now, the most popular ones are Ondo Finance and xStocks.

Ondo has 60% market share in the tokenized stocks sector, and xStocks has 28%.

Source: https://app.rwa.xyz/stocks

That said, there’s an important caveat. Ondo is currently the only major issuer with a live token, but ONDO is a governance token with limited utility for holders today.

There have been proposals around revenue sharing/buybacks, but there’s no timeline for their implementation. So while Ondo’s TVL could grow significantly if tokenized stocks take off, that growth may not necessarily translate into ONDO token pumping.

Another project that could benefit in the long run is Hyperliquid. Hyperliquid doesn’t offer spot trading for tokenized stocks, but it does offer RWA perps, from which it has generated significant revenue.

The only drawback is that Hyperliquid isn’t officially available to users in the US for now, so it may not immediately capture the upside of the SEC’s innovation exemption.

But the Hyperliquid team is working on making it accessible in the US.

Lastly, I think money markets could also see significant growth in TVL, driven by friendly regulations for tokenized stocks and ETFs.

I believe many people would love the idea of borrowing against their equity portfolios for day-to-day purchases, yield farming, or other investments. Right now, Kamino on Solana is the most popular place for borrowing against tokenized stocks & ETFs.

But I expect that projects like Aave will eventually allow that as well.

Overall, I’m excited about the direction crypto is heading.

We’ve been waiting for regulatory clarity and pro-crypto regulation for years.

Now those are finally coming, and they are going to attract more money into the industry than ever before.

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Together with Apyx

The fastest-growing STRC-backed DeFi protocol

One of the fastest-growing new DeFi protocols has been Apyx.

In less than 3 months, it surpassed $476M in TVL.

Apyx is the first stablecoin protocol backed by Digital Asset Treasury (DAT) preferred equity, such as Strategy’s STRC and Strive’s SATA.

As STRC has a very high base yield, Apyx can offer 10.73% APY to the holders of its apyUSD yield-bearing asset.

And in addition to this, APYX Airdrop is also coming:

• 5% of its total token supply will be distributed as part of its Season 1 points program that ends on May 22

• 4% of its total token supply is allocated for Season 2 of its points program, which starts right after Season 1 ends

The exact date when the APYX token launches has not been announced yet.

But what we know is this:

The APYX token will have a staking mechanism, enabling stakers to either earn additional APYX tokens or receive apxUSD dividends from the protocol’s revenue.

APYX will provide a way to bet directly on the STRC narrative for the first time.

As Apyx is the largest STRC-backed protocol, it benefits from STRC’s success, and APYX token holders will get more revenue as the dApp grows.

You can farm Apyx by holding apyUSD, apxUSD, or by using them in DeFi across various protocols like Pendle and Morpho.

Start exploring Apyx today!

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Chart of the week

EtherFi Cash is one of the fastest-growing crypto neobanks

Source: Token Terminal report

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Crypto meme of the week😂

Tooly@ToolySOL

Still Legendary.

11:33 PM · May 4, 2026 · 88.2K Views

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32 Replies · 87 Reposts · 2.64K Likes

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The latest developments in DeFi

Variational raised $50M in funding and launched RWA perps

Polymarket launched pre-IPO markets for trading private companies

SkyMoney increased the SKY Staking Rate from 1.31% to 5.71% (fueled by buybacks)

Pendle released the Pendle Trading Alert Bot, enabling users to set alerts for limit order fills, new market launches, and more

Chainlink SVR was integrated into Aave V4, adding a new revenue stream for Aave from liquidation MEV

Lighter announced Lighter RFQ, bringing institutional-grade liquidity for RWA pairs

CME and NYSE are pushing the US to force Hyperliquid to integrate KYC

ProjectX announced an airdrop (likely in stablecoins) for May 22

Bitwise committed to use 10% of the revenue from its Hyperliquid ETF to buy HYPE

SEC is allegedly preparing to allow on-chain tokenized stock trading

Lombard and Kraken are migrating from LayerZero to Chainlink CCIP for their cross-chain infrastructure

Japan officially recognized stablecoins as legal payment methods

Solstice postponed its TGE to May 25

Aave’s proposal to expand to Monad is live

Strategy acquired $2 billion worth of BTC

Thorchain suffered a $10M exploit

That’s all for this week!

Until next time,

The DeFi Investor

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