Tokenized stocks briefly lift real share prices

Tokenized U.S. shares on Robinhood Chain briefly appeared to transmit buying pressure into the underlying stock market in early September, most visibly in AMC Entertainment, before a creation-and-redemption mechanism sharply expanded token supply and erased the premium. Blockchain records show tokenized AMC supply rose from 152,106 shares to 2,895,758 shares in 72 hours, a 19-fold increase, after the on-chain version traded far above AMC’s Nasdaq closing price.

The episode shows how stock-linked tokens can affect trading in the underlying shares during narrow windows, particularly when U.S. markets are closed and token markets remain open. Yet the same structure limits a sustained dislocation: licensed intermediaries can acquire the underlying stock, mint additional tokens at fair value and sell into the premium. Once that supply enters circulation, the scarcity driving the token price higher can fade rapidly.

AMC’s sharpest divergence followed a social-media post by Adam Aron, chief executive officer of AMC Entertainment. At 5:18 p.m. New York time on Thursday, 78 minutes after the equity market closed, Aron called the tokenized AMC product “reprehensible, absurd, and disgusting,” adding that he had retained outside securities counsel.

Within six hours, two meme tokens named after Aron’s post began trading in liquidity pools denominated in tokenized AMC. The tokenized share changed hands at $18.04, compared with AMC’s $2.54 closing price on Nasdaq.

Premarket gap narrowed within minutes

When U.S. premarket trading opened at 4:00 a.m. Eastern time on Sept. 4, tokenized AMC traded at $4.09 while the underlying stock’s last price remained $2.54, a 61% premium. AMC shares climbed to $3.11 in the first 15 minutes of premarket trading, up 22% from the previous close, while the token price fell.

By 9:29 a.m., immediately before the regular session, the two markets had nearly converged: AMC traded at $2.62 and the tokenized version at $2.61. The stock ended the session at $2.65.

Blockchain records indicate that the issuance agent bought and held roughly $7.6 million of AMC shares in the secondary market over that weekend. During the busiest period, those purchases represented as much as 7.6% of AMC’s premarket volume. About 310,000 tokenized AMC shares were later redeemed and destroyed, partially reversing the expansion in circulating supply.

The mechanics resemble the primary market for exchange-traded funds. Robinhood Assets (Jersey) Limited issues the stock-linked instruments as debt products designed to track individual U.S. stocks, with corresponding real shares held in custody. Authorized intermediaries can create or redeem tokens at fair value, allowing them to arbitrage a gap between the blockchain product and the listed stock.

That process connects an on-chain premium to real-world equity buying, but it also caps the effect. A premium can encourage agents to buy shares, mint tokens and sell those tokens until the price difference narrows. A discount can trigger the reverse trade, reducing token supply through redemptions.

Meme-token pools changed the route of demand

The AMC surge was amplified by the design of the liquidity pools. Meme tokens quoted in tokenized shares require purchases to pass through the stock token, mechanically building demand for the tokenized equity rather than simply collecting fees in cash. Seven pools denominated in stock tokens have entered Robinhood Chain’s 100 most active liquidity pools, with combined daily turnover of about $73 million, according to blockchain records.

A similar pattern emerged in tokenized Hims & Hers Health. Supply rose from 468 shares on Aug. 20 to 130,876 shares, a 280-fold increase. The additional tokens corresponded to about $3.6 million of Hims & Hers shares purchased and held in custody.

The Hims & Hers-linked meme token initially accounted for 81% of the relevant tokenized-share supply. Its share fell to 47% over four days even as the number of meme tokens in the liquidity pool increased. New issuance diluted the pool’s grip on the available tokenized float, reducing the ability of continuing inflows to lift the token’s price.

A conversion estimate from the Hims & Hers episode illustrates the limited scale of the transmission effect. A peak meme-token market value of about $85 million translated into roughly $3.6 million of underlying stock purchases and custody. That equates to around $0.04 of real-share buying for every $1 of meme-token market value.

Scale limits the effect in heavily traded stocks

Across roughly 50 stock-token underlyings on Robinhood Chain, the real shares held in custody total about $138 million, based on the supplied blockchain data. AMC alone traded approximately $150 million of value on Nasdaq last Friday, leaving the entire tokenized-stock inventory smaller than one active trading day in a single mid-cap equity.

That comparison places the AMC move in context. Token activity may contribute to price pressure during thin periods such as overnight sessions or premarket trading, when relatively modest orders can move prices. It faces a much deeper pool of liquidity once the regular U.S. session begins.

Farmmi provided a more extreme example of the risks around thin liquidity. The stock rose 321% intraday before retracing most of the move within a week. Figures in the supplied analysis put Farmmi’s Sept. 2 trading volume at 872.6 million shares, against an average of 45,000 shares—roughly 19,000 times normal activity.

The largest pricing gaps appear when the U.S. equity market is closed but stock tokens continue to trade. In those periods, new creation may be unavailable, leaving the circulating supply fixed until the relevant issuance channel reopens. The supplied records showed several stock tokens had last received new supply at 23:35 UTC on a Friday, creating an extended holiday-weekend window before Tuesday premarket trading.

Even then, the results varied. Tokenized Hims & Hers traded between a 2% discount and a 4% premium, last quoted 2.9% above the underlying share price. Tokenized AMC spent much of the same period at a discount, at one point reaching minus 7%, despite about $40 million in combined volume between the two products.

AMC’s expanded token supply likely reduced its sensitivity to another temporary creation halt. With nearly 2.9 million tokens outstanding rather than roughly 152,000, any one liquidity pool represented a smaller portion of the circulating market.

The available figures also place the setup far from the conditions behind the 2021 GameStop squeeze, when short interest reached about 138% of the float and the stock ran from $17 to an intraday $483 on Jan. 28. The tokenized-stock examples cited days-to-cover figures between three and nine, with modeled gains of 7% to 14% even under full short-cover assumptions. Tokenized share markets can create temporary pricing distortions, but issuance capacity and the depth of the underlying equity market remain powerful constraints on how long those distortions can last.