How to Invest in Healthcare Stocks On-Chain with Crypto
Learn how to buy tokenized healthcare stocks and ETFs like JNJ, LLY, and XLV on-chain. We explain 1:1 backing, DeFi composability, and how it compares to traditional brokers.
How to Invest in Healthcare Stocks On-Chain with Crypto
For investors around the world, gaining exposure to the healthcare sector has traditionally meant navigating complex and often restrictive brokerage systems. We believe tokenization fundamentally changes this. It allows global investors to buy fractional shares of leading healthcare companies and hold them as on-chain assets in their own wallets. This approach combines the growth potential of the healthcare industry with the efficiency, accessibility, and composability of decentralized finance (DeFi).
On our platform, GM Markets, you can access tokenized healthcare stocks that are fully backed 1:1 by real-world shares. For every tokenized share of a company like Johnson & Johnson or Eli Lilly you buy, there is one corresponding share held in a segregated account at a regulated broker. This model removes the friction of traditional finance, enables fractional ownership from just $1, and unlocks the ability to integrate these assets into the broader DeFi ecosystem.
Why Tokenize Exposure to the Healthcare Sector?
The healthcare industry has long been a cornerstone of investment portfolios due to its unique characteristics. It benefits from powerful demographic tailwinds, such as aging populations, and a constant drive for innovation. This often results in non-cyclical demand that can provide stability during periods of economic uncertainty. According to analysis from McKinsey, overall U.S. healthcare profit pools are projected to grow 4% annually, reaching $790 billion by 2026.
The healthcare industry is diverse, comprising several key sub-sectors where investors can find opportunities:
- Pharmaceuticals: Companies that discover, develop, and manufacture drugs and vaccines, such as Pfizer and Merck.
- Biotechnology: Firms focused on research and development using biological systems to create new products and therapies.
- Medical Devices & Equipment: Businesses that produce everything from surgical instruments to advanced diagnostic imaging machines.
- Healthcare Providers & Services: This includes hospitals, clinics, and managed care companies that deliver health services directly to patients.
Tokenization adds a new layer of benefits to this established sector, making it more accessible and efficient for a global audience.
Tokenized Stocks vs. Traditional Brokers for Global Investors
For investors outside the U.S., the on-chain model offers distinct advantages over traditional brokerage accounts. The differences in access, cost, and functionality are significant.
| Feature | GM Markets (On-Chain) | Traditional Brokerage |
|---|---|---|
| Onboarding | Permissionless with a crypto wallet or email. Instant access. | Requires extensive paperwork, proof of address, and often has jurisdictional restrictions. Can take days or weeks. |
| Minimum Investment | Start with as little as $1 through fractional shares. | Often requires buying at least one full share, which can be hundreds of dollars. Higher account minimums may apply. |
| Cross-Border Fees | Free deposits for stablecoins. No currency conversion (FX) fees. | High fees for international wire transfers and currency conversion. |
| Settlement Speed | Near-instant settlement on the blockchain. | T+1 or T+2 settlement (one or two business days). |
| Asset Composability | Tokens are standard ERC-20 assets usable as collateral in DeFi for lending, borrowing, and liquidity provision. | Shares are locked in a brokerage account and cannot be used in other financial applications. |
How Tokenized Healthcare Stocks Work on GM Markets
Transparency and security are central to how we designed our platform. When you buy a tokenized healthcare stock with us, you are interacting with a system built on verifiable, 1:1 backing.
First, every token we issue represents one real share of the underlying company. These shares are purchased and held in segregated customer accounts at regulated, established broker-dealers, including Interactive Brokers and Alpaca Markets. This ensures the assets are held separately from our own and are protected under relevant custody regulations.
Second, we provide real-time, on-chain proof of the underlying assets through our Proof of Reserves page. This system uses a third-party attestation service, Accountable, to read the balances directly from our brokerage accounts and publish the data on-chain. You can independently verify that the number of tokens in circulation matches the number of shares held in custody.
Finally, we use a total-return model for dividends. When a company like Pfizer, which has a dividend yield that has recently been near 7.0%, pays a dividend, we use the proceeds to purchase more of the underlying stock. This increases the Net Asset Value (NAV) of your token, so the value of the dividend is reflected directly in the token's price rather than being paid out as a separate transaction.
Step-by-Step: Buying Your First Tokenized Healthcare Stock
Getting started on our platform is a straightforward process designed for both crypto-native users and those new to on-chain assets.
- Create an Account or Connect a Wallet: You can onboard instantly by connecting an existing wallet like MetaMask or by creating a new, embedded wallet using an email or social login. Our embedded wallets use multi-party computation (MPC) for enhanced security.
- Deposit Funds: Fund your account by depositing stablecoins such as USDC or USDT from any supported chain. We automatically convert these into our unified balance, USDF, which you use for trading.
- Find a Healthcare Asset: Use the search bar on the trading page to look for a specific healthcare stock or ETF by its ticker.
- Execute Your Trade: Enter the amount you wish to buy. We use a Request-For-Quote (RFQ) system, which provides a firm price from our market-making partners. The price you see is the price you get, with our trading fee included and no risk of slippage.
- Verify the Token in Your Wallet: After the trade is complete, the tokenized stock appears in your GM Markets wallet as a standard ERC-20 token. You have full self-custody and can view it on a block explorer.
Key Healthcare Stocks and ETFs on GM Markets
We offer access to a range of leading companies and funds that represent the breadth of the healthcare industry. Here are some examples of assets you can find on our platform:
- Johnson & Johnson (JNJ): A global giant known for its pharmaceuticals, medical devices, and consumer health products.
- Eli Lilly (LLY): A leading pharmaceutical company with a strong pipeline in areas like diabetes and obesity treatments.
- Pfizer (PFE): One of the world's largest pharmaceutical companies, known for its extensive portfolio of medicines and vaccines.
- Merck & Co. (MRK): A major player in pharmaceuticals, particularly in oncology and vaccines.
- Health Care Select Sector SPDR Fund (XLV): A large and liquid ETF that provides diversified exposure to the S&P 500's healthcare sector, with over $41 billion in assets under management.
Risks and Important Considerations
We are committed to transparency, which includes being clear about the risks involved. Investing in any asset, including tokenized stocks, carries risk. The value of these tokens is tied to the market price of the underlying shares, which can be volatile.
Additionally, there are risks specific to on-chain assets, including smart contract vulnerabilities and counterparty risk. While our smart contracts are audited by leading security firms, no system can be guaranteed to be entirely free of risk. It is also important to understand that holding a tokenized stock provides you with economic exposure to the asset's price and dividends, but it does not grant you the shareholder voting rights that come with direct share ownership.
Please be aware that GM Markets does not provide financial, legal, or tax advice. All trading involves the risk of loss. For a complete overview, please consult our legal and risk disclosures.
GM Markets is not offered to users in the United States or other restricted jurisdictions.
Frequently Asked Questions
What happens to dividends from my tokenized healthcare stocks?
We operate on a total-return model. Dividends are automatically reinvested by purchasing more of the underlying shares. This increases the on-chain Net Asset Value (NAV) of your token, so you see the value reflected in the token's price.
Are these tokens regulated securities?
The regulatory landscape is evolving. In jurisdictions like the European Union and the United Kingdom, regulators apply a technology-neutral approach, meaning the rules depend on the asset's function, not the underlying blockchain technology. The European Securities and Markets Authority (ESMA) has clarified that if a crypto-asset qualifies as a financial instrument under MiFID II, it is subject to the same rules as a traditional security. For other crypto-assets, the Markets in Crypto-Assets (MiCA) regulation will apply. Similarly, the UK's Financial Conduct Authority (FCA) treats tokens that confer rights like shares or debt as 'security tokens' subject to existing securities laws. Our tokens are designed to represent a 1:1 claim on a real-world security held at a regulated custodian.
Can I move my tokenized stocks to an external wallet like MetaMask?
Yes. The tokens are standard ERC-20 assets on supported chains like Base and Arbitrum. You have full self-custody and can withdraw them from your embedded GM Markets wallet to any compatible external wallet.
What are the fees for trading tokenized healthcare stocks on GM Markets?
We charge a single, transparent trading fee that ranges from 0.10% to 0.20%, depending on your trading volume. This fee is included in the price we quote you. Deposits and withdrawals are free. You can find the full details on our pricing page.
Start Building Your On-Chain Healthcare Portfolio
GM Markets provides a secure and efficient bridge to the global healthcare equity market for on-chain investors. By combining 1:1 backing, real-time Proof of Reserves, and the power of DeFi composability, we offer a modern way to gain exposure to one of the world's most vital sectors. You can diversify your on-chain portfolio with assets that have historically provided long-term growth and stability.
To get started, visit the GM Markets platform to explore the full range of available healthcare stocks and ETFs.
