A full-page ad in the Wall Street Journal's October 24-25 weekend edition warned public company CEOs that tokenized stocks are shadows with no vote, dividend, or legal standing. Twenty-two companies, including Microsoft, Alphabet, Goldman Sachs, Wells Fargo, Arm, and McDonald's, have since opted out of a plan to tokenize their shares.
This post is a summary of my full interview with Andreas Kohl, co-founder of Sequentia, a Bitcoin-anchored sidechain built by Concatena Labs. Read the complete interview on Lightning News.
1. "The ad calls tokenized stocks shadows with no vote, dividend, or legal standing. What does a Sequentia token holder own legally?"
Kohl's core point: what a holder owns legally depends on how the asset was issued. He agrees that some "tokenized stocks" really are shadows with no vote, dividend, or legal standing, and he calls it unfortunate that such products get bundled together with true tokenized equity.
True tokenized equity is already possible in many jurisdictions. Companies can self-issue or use a service provider, with transfers restricted to whitelisted addresses of known investors. That solves ownership and rights but adds friction and loses privacy. A more interesting model, which so far only Switzerland explicitly allows, is tokenized equity with no transfer restrictions: freely traded as pseudonymous bearer certificates, with KYC required only at shareholder registration to exercise voting or dividend rights.
Sequentia is pursuing a tokenization service provider in the jurisdiction of Prospera, which has a regulatory election framework that lets companies follow the rules of jurisdictions deemed to follow best practices, such as Switzerland. Trust minimization exists on a spectrum, and even lighter setups, from assets with controls delegated to a virtual asset service provider to CSD-held shares with more transparent supply supervision, are improvements over the status quo. The end goal is full disintermediation between holders and issuers.
He also clarifies the network token: Sequence (SEQ) is a bond that lets holders participate in block production and collect transaction fees. It is not a coin. The protocol does not favor SEQ over any other asset on Sequentia, and the target user never needs to know it exists.
2. "Twenty-two giants just opted out of tokenizing their shares. If issuers can veto this, does tokenized equity only work with Wall Street's permission?"
Kohl's core point: issuer opt-outs do not stop tokenized derivatives of their shares from trading. But the deeper issue is different. Tokenization is a broad label covering many vehicles with different trust profiles. The real question is whether owning or trading an asset must require trust in anyone besides the issuer.
Today, most publicly traded US equity is legally owned by a company called Cede & Co., and other markets have analogous central securities depositories. Public stock markets only list claims to assets that stay owned by the CSD. The interests of CSD owners are not always aligned with issuers or traders, and the system gets exploited through naked short selling, which Kohl describes as printing value out of thin air and picking winners and losers.
Companies have long been able to opt out of the CSD system, but historically at the cost of trading friction and fractured liquidity. Tokenization makes operating outside CSD control more viable and strengthens regulatory arbitrage, since a company can take its tokenized equity "with it" to another jurisdiction more easily than equity already forfeited to a CSD. True tokenized equity does need the issuer's permission, as it should. What it should not need is the permission of the intermediaries standing between issuers and shareholders.
3. "Tokenized stocks already trade on altcoin chains. Why does this need a Bitcoin-anchored sidechain, and does anchoring fix the risks?"
Kohl's core point: trustless swaps between Bitcoin and altcoin-chain assets are possible today, but they are slow, expensive, and complicated, which is why most people default to centralized exchanges. Part of the problem is finality risk: either chain can reorganize independently. Anchoring synchronizes Sequentia with Bitcoin so the two must always reorganize together. If one side of a BTC to Sequentia swap is reversed, the other side is reversed too. This also enables fast off-chain swaps using Lightning or Ark.
Unlike altcoin chains, which force their own coin as the only way to pay fees, Sequentia lets any issued token pay network fees. Bitcoin is the monetary standard of the ecosystem: it is the only balance always shown, and Sequentia shares Bitcoin's address and seed formats, so a Sequentia wallet feels like a single-chain Bitcoin wallet.
On risks anchoring does not fix: issuers are more in control of the network than block producers, since they can move recognition of their shares from one network to another at any time. SEQ fee revenue is proportionate to the trust users place in block producers, and Bitcoin checkpointing protects ledger immutability beyond a two-week window. At the far end of the spectrum: no CSD, no intermediary, no finality risk beyond Bitcoin's own. Kohl's summary of the purpose: Bitcoin as the money, the only truly trustless asset; financial instruments as more speculative assets implying trust in their issuer; and as little as possible in between.
Want the full answers? Read the complete interview on Lightning News. You can also find Andreas on X at @aejkohl, try out the Sequentia testnet, and join the @sequentia_official community on Telegram.
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