How to Swap Crypto for Tokenized US Stocks in Minutes
Learn how to swap crypto for tokenized US stocks on GM Markets. Our platform offers permissionless access, rapid settlement, and DeFi composability for global investors.
How to Swap Crypto for Tokenized US Stocks in Minutes
The global financial landscape is evolving, connecting traditional equity markets with decentralized finance. For investors seeking direct, self-custodial access to US-listed equities, tokenized stocks provide a method for trading. On GM Markets, we offer a permissionless process to convert stablecoins into tokenized US stocks. This guide explains how our platform enables global retail investors to gain exposure to traditional equity markets with DeFi composability. We provide speed, ease of use, and accessibility for trading tokenized stocks from outside restricted jurisdictions.
What Are Tokenized US Stocks?
Tokenized stocks are digital representations of real-world shares, existing as standard ERC-20 tokens on a blockchain. Each token we issue is fully backed 1:1 by an actual share held in a segregated customer account at a regulated broker-dealer, such as Interactive Brokers or Alpaca Markets. This backing ensures that your tokenized position accurately reflects the economic value of the underlying share.
The characteristics of tokenized stocks on our platform include:
- Fractional Ownership: Trade from as little as $1, allowing ownership of fractions of high-value stocks.
- 24/7 Exposure: While traditional markets have specific trading hours, you can place orders on GM Markets at any time. Out-of-hours orders are queued on-chain and fill when liquidity appears or the market opens.
- DeFi Composability: These tokens are standard on-chain assets. This means your US stock exposure can be used across various decentralized finance protocols for lending, borrowing, or supplying liquidity on platforms such as Aave, Morpho, Uniswap, Curve, and CoW Swap. This provides additional uses for capital beyond price appreciation. The DeFi market was valued at approximately USD 35.02 billion in 2024 and is projected to reach USD 1257.38 billion by 2034, as reported by market research such as Grand View Research. This indicates potential for composable assets within this ecosystem. This modularity allows different protocols to interact. It supports development and integration within the financial system.
We detail the mechanics of tokenized stocks and their security features on our learn page.
Why Swap Crypto for Stocks on GM Markets?
Our platform offers a trading experience for tokenized US stocks, particularly for global investors who face friction or restrictions accessing traditional equity markets. GM Markets provides the following:
Permissionless Access
We offer permissionless onboarding. You can connect an existing external Web3 wallet or create a new embedded wallet using your email or Google account. Our embedded wallets are powered by Privy using multi-party computation (MPC), which supports security by distributing key management. This approach allows access to markets without extensive upfront Know Your Customer (KYC) procedures typically associated with traditional brokerages, facilitating entry into global equities.
Speed and Efficiency
Converting stablecoins to tokenized stocks on GM Markets typically results in rapid settlement (T+0). Transactions finalize within seconds or minutes on the blockchain. Orders placed during traditional market hours are generally filled immediately. This is a contrast to traditional US equity markets, which transitioned to a T+1 settlement cycle (one business day after execution) on May 28, 2024. This rapid settlement on our platform minimizes counterparty risk and allows for faster capital turnover.
Cost-Effective Trading
Our fee structure is transparent. We charge a single trading fee ranging from 10 to 20 basis points (0.10% to 0.20%). The default fee is 20 bps, which scales down to 10 bps at our VIP 5 tier as your 14-day trading volume grows. This fee is always included in the quoted price, so the "You will receive" line is final. Furthermore, deposits and withdrawals are free across all rails, including Apple Pay, card, bank, and stablecoin transfers. We do not charge custody, inactivity, dividend, or FX markup fees. You can review our full pricing details on our platform.
Gas Abstraction
We abstract away native chain gas fees. Our smart account pays the gas on your behalf and bills the equivalent in USDF from your balance. This means you never need to hold a native chain token to cover transaction costs, simplifying the trading process and supporting user experience.
Self-Custody and Security
When you acquire tokenized stocks on GM Markets, the tokens reside in your self-custodial wallet, not on our balance sheet. This gives you full control over your assets. In the event GM Markets discontinues operations, a designated security agent works with the custodian to redeem outstanding tokens against the underlying shares, a path enforced by the on-chain contract and independent of GM Markets. This structure ensures your assets remain segregated and accessible.
Real-Time Attestation
Transparency is a core principle. Our reserves are independently attested on-chain in real time by Accountable, a third-party proof-of-reserves provider. This allows you to verify the 1:1 backing of your tokenized assets at any time by checking our Proof of Reserves page. This verifiable mechanism supports trust and provides continuous assurance of asset backing.
Your Step-by-Step Guide to Swapping Crypto for Tokenized Stocks
Swapping your stablecoins for tokenized US stocks on GM Markets is a straightforward process:
Step 1: Connect Your Wallet or Create an Account
Navigate to our platform and choose your preferred connection method. You can connect an existing external Web3 wallet (such as MetaMask or WalletConnect) or create a new embedded wallet. To create an embedded wallet, simply sign up using your email address or Google account, which leverages Privy MPC for secure key management.
Step 2: Deposit Stablecoins (USDC/USDT)
Once connected, proceed to deposit stablecoins. We accept deposits of USDC and USDT, which are unified into your USDF balance. USDF functions as the platform's stablecoin balance, backed 1:1 by USDC and USDT across various supported chains. You can deposit from Base, Arbitrum, Ethereum, and Optimism networks.
Step 3: Select Your Desired Tokenized Stock
Browse our catalog of tokenized US stocks and ETFs. GM Markets offers over 1,000 tokenized US stocks and ETFs. Specific attested assets include Apple (AAPL), NVIDIA (NVDA), Microsoft (MSFT), Tesla (TSLA), Alphabet (GOOGL), Meta Platforms (META), Advanced Micro Devices (AMD), Taiwan Semiconductor Manufacturing Company (TSM), SPDR S&P 500 ETF Trust (SPY), Vanguard S&P 500 ETF (VOO), and Invesco QQQ Trust (QQQ). You can initiate trades from as little as $1.
Step 4: Review and Confirm Your Trade
When you select an asset to trade, you will receive a Request-For-Quote (RFQ) from our regulated market-making partners. This quote reflects the live underlying market price. Review the quoted price and the "You will receive" amount, which includes our transparent trading fee. Our platform has a default slippage tolerance of 0.5%, which is user-configurable for each trade. If the market moves beyond your set tolerance during the quote window, the trade will not execute, and a new quote will be issued.
Step 5: Receive Your Tokenized Stocks
After confirming your trade, the tokenized stocks are settled directly on-chain into your self-custodial wallet. This process typically completes within seconds or minutes, providing immediate ownership and control of your new asset.
The Mechanics Behind a Fast Crypto-to-Stock Swap
The speed and efficiency of our platform result from several technological and operational components:
Request-For-Quote (RFQ) Execution
We utilize an RFQ execution model. Regulated market-making partners provide real-time quotes against the live underlying market. These partners then settle trades back-to-back upon acceptance, ensuring competitive pricing and efficient execution that closely tracks the underlying asset.
Smart Contract Settlement
All trades are executed and settled on supported EVM-compatible blockchains, including Base, Arbitrum, Ethereum, and Optimism. Our smart contracts automate the minting and burning of tokens, ensuring secure and transparent on-chain settlement. This distributed ledger technology provides an immutable record of all transactions. It supports security and auditability.
1:1 Backing and Proof of Reserves
Our tokenized stocks are based on 1:1 backing by real shares held in segregated customer accounts. This backing is continuously verified through Accountable's independent, real-time on-chain attestation. This mechanism provides verifiable proof that every tokenized share corresponds to an actual share held in custody. It supports trust and security. You can find more details on our security practices.
Privy MPC Wallets
For users opting for an embedded wallet, Privy's multi-party computation (MPC) technology ensures robust security. MPC means that no single party, including GM Markets, holds the complete private key. The key is reconstructed from multiple shares only at the moment of signing a transaction on your device, providing a secure self-custodial experience. This cryptographic technique protects assets while maintaining ease of use.
Important Considerations for Tokenized Stock Trading
While tokenized stocks offer advantages, it is important to be aware of the inherent risks and specific characteristics of this asset class, especially as GM Markets is currently in public beta. While core functionalities are robust, some surfaces are still evolving.
- Risk Disclosure: Markets can move against you, and you may lose money. Trading tokenized stocks carries settlement, counterparty, smart-contract, and custody risks. We do not provide financial, investment, tax, or legal advice. Please consult our legal page for a comprehensive overview of risks and disclaimers.
- Jurisdiction: GM Markets does not offer its products or services to users in the United States or other restricted jurisdictions. Access to our platform is prohibited for users from these regions. We maintain this list of restricted jurisdictions operationally, and it may be updated as regulations evolve.
- Economic Exposure, Not Voting Rights: Tokenized stocks provide economic exposure to the underlying asset's price movements and dividends (via NAV adjustments). However, holding tokenized stocks does not confer shareholder voting rights, which are typically associated with directly held shares.
- Total-Return Model for Dividends: We operate a total-return model. When dividends are paid on the underlying shares, they are used to acquire more of the underlying asset, which in turn increases the token's on-chain Net Asset Value (NAV). You receive the dividend value through the appreciation of your token's NAV rather than as a separate cash payout. Corporate actions like splits or mergers are also absorbed into the NAV to ensure your position tracks the underlying exactly.
Frequently Asked Questions
What stablecoins can I use to deposit on GM Markets?
We accept deposits of USDC and USDT. These stablecoins are unified into your USDF balance, which is backed 1:1 by USDC and USDT across the supported chains: Base, Arbitrum, Ethereum, and Optimism.
Are there any gas fees when swapping crypto for tokenized stocks?
No, you do not pay native chain gas fees directly. Gas is abstracted by our smart account and billed as an equivalent amount in USDF from your balance. You never need to hold a native chain token to cover these costs.
How quickly do trades settle on GM Markets?
Trades on GM Markets typically settle rapidly (T+0), with transactions finalizing on the blockchain within seconds or minutes. Orders placed during traditional market hours are generally filled immediately.
Do I receive dividends on tokenized stocks?
Yes, you receive the economic value of dividends. These are reinvested into the underlying asset, which increases the token's on-chain Net Asset Value (NAV). You experience this as an increase in the token's price rather than a separate cash payout.
Can I withdraw my tokenized stocks to an external wallet?
Yes, our tokenized stocks are standard ERC-20 assets. You can withdraw them to any compatible external Web3 wallet, allowing you to leverage their composability across the broader DeFi ecosystem.
Trading Tokenized Stocks on GM Markets
GM Markets provides fast, secure, and accessible access to tokenized US stocks for investors globally. Our platform simplifies the process of converting crypto into equity exposure. It combines the efficiency of blockchain settlement with traditional assets. The transition of traditional markets to T+1 settlement, as confirmed by the U.S. Securities and Exchange Commission, further highlights the speed of on-chain T+0 settlement. The growing DeFi market, with its emphasis on composability, provides flexibility for tokenized assets. This allows for integration with various DeFi protocols. It supports the utility of your investment. We provide transparency, user control, and a trading environment. Explore the markets on GM Markets and consider trading tokenized stocks.
