Republic, a New York-based investment platform, has started offering tokenized exposure to SpaceX shares, aiming to give retail investors access to private company stakes that were traditionally limited to large, accredited investors.
What Happened: The company's digital tokens, which do not confer direct ownership but provide exposure to share performance, will soon be available for purchase, with plans to expand the offering to other private giants like OpenAI, Anthropic, Stripe, X, Waymo, and Epic Games, according to The Wall Street Journal.
Republic co-CEO Andrew Durgee told CNBC the initiative is designed to open doors for retail investors who have long been excluded from pre-IPO opportunities.
“The fact that retail investors couldn't own pre-IPO SpaceX has always been crazy to us," Durgee said, emphasizing the company's focus on assets with broad public interest.
Tokenization in crypto involves creating blockchain-based representations of assets like stocks or commodities. Investors in these tokenized products gain price exposure but do not hold the actual underlying assets.
The announcement comes as the U.S. crypto industry enters a more permissive regulatory climate under President Donald Trump's administration.
Recent regulatory developments include the SEC dropping enforcement cases against Coinbase (NASDAQ:COIN) and other major crypto players, scaling back crypto enforcement units, and clarifying that meme coins are not securities.
A new Crypto Task Force is also actively engaging with the industry through policy roundtables.
Durgee noted that the crypto space, once mired in restrictive oversight, is now benefiting from a more supportive environment.
"We've moved from nothing but headwinds to having industrywide tailwinds," he said.
Republic will allow retail investors to purchase tokenized shares with investments ranging from $50 to $5,000, significantly lowering the usual barriers to entry.
Private company shares are typically accessible to accredited investors with higher minimum investment thresholds.
The tokens will initially be priced based on secondary market valuations of SpaceX shares.
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Why It Matters: The offering raises fresh regulatory questions, including how tokenized private equity aligns with disclosure rules, whether such structures could increase risks to retail investors, and how companies being represented will respond to this method of investment access.
Durgee said companies' approval isn't required for these offerings under the current securities framework, which was built on laws dating back to the 1930s.
"People will really have to start questioning how they approach these innovations and how far they want to push the risk envelope," he added.
The push toward tokenization is gaining broader institutional interest. Proponents cite benefits like faster settlements, reduced transaction costs, increased transparency, and improved global accessibility for retail participants.
Coinbase recently announced its intent to seek SEC approval to list tokenized public stocks, potentially expanding its offerings to compete directly with trading platforms like Robinhood (NASDAQ:HOOD) and eToro.
Kraken has also signaled plans to offer 24/7 tokenized stock trading in international markets.
BlackRock (NYSE:BLK) CEO Larry Fink has called the tokenization of financial assets a critical step in transforming financial markets.
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