Alpaca Custodies 94% of Tokenized U.S. Stocks, DTCC Launch Looms

Tokenization converts a real-world asset into a digital token on a blockchain so that the token stands in for the asset. For equities, that requires a licensed broker to buy and hold the shares, match token supply to inventory, and handle corporate actions such as dividends and splits.

Alpaca, a self-clearing broker-dealer founded in 2015, reported it clears or custodies about 94% of tokenized U.S. stocks and ETFs and holds more than $1.5 billion of the underlying shares that back live tokens. The firm operates minting and redemption systems, processes corporate actions, and provides stock lending, short locates and insured cash-sweep services for issuers and market makers. Alpaca counts Binance, Kraken, Ondo and Dinari among its partners. On July 16 the company raised $135 million led by Peak XV, and additional debt from Payward and BMO increased the financing package to $435 million.

Public trackers report different totals for tokenized-stock value. Alpaca’s $1.5 billion figure applies only to shares backing tokens that are live and in circulation and excludes ordinary brokerage client holdings. The exact market share depends on the data sources and timing; Alpaca and public trackers have not published a reconciliation of methodologies.

The U.S. Securities and Exchange Commission has warned that third-party token products may provide only economic exposure and may not transfer legal ownership rights to holders. Most current third-party tokenized equity products do not carry voting rights or direct dividend entitlements; token holders generally hold contractual claims against the issuer. Broadridge has worked with market participants on proxy voting and governance arrangements for tokenized equities.

The market faced a stress test in June when more than $1 billion of tokenized pre-IPO exposure to a private company was sold through an issuance platform, including about $557 million on one exchange. The underlying shares did not arrive and buyers were refunded. The failure occurred at the allocation layer where shares are sourced, upstream of custody operations.

The Depository Trust & Clearing Corporation will launch its Tokenization Service in October. Its Depository Trust Company subsidiary holds more than $114 trillion in securities and its subsidiaries reported $4.7 quadrillion in settled transactions during 2025. Production trades on July 15 involved more than 30 firms and served as a trial for the service, which received a three-year SEC authorization in December 2025. Initial coverage will include Russell 1000 names, major ETFs and U.S. Treasuries. Tokens minted through DTC are intended to carry the same voting rights, dividend entitlements and legal ownership as the securities they represent because they originate inside the central custody system.

Alpaca has been self-clearing at DTCC since 2024 and participated in the industry working group that designed the DTC tokenization service. The firm took part in the July 15 production runs and supported an early DTCC-backed token demonstration. Alpaca described the DTCC service as supplying the settlement layer while brokers continue to provide clearing, margin, stock loan and locate services.

Transferring underlying positions through DTC can take days. Firms planning to migrate must rebuild API integrations and coordinate minting and redemption cutovers with market makers. Many market makers connect through Alpaca, a factor firms must consider when planning any transition.

Tokens trade across blockchains and exchanges, while the custody and settlement link to U.S. securities sits with a small set of brokerages. Alpaca reports a leading share of the brokerage layer and has been involved in designing the official settlement system.