CZ Says Tokenization Attracts Foreign Investment, Still No Deal Named

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• Changpeng Zhao says tokenizing stocks and state assets can help countries raise money and attract foreign investment, but this is the third version of that pitch he’s made to governments since January without naming a completed deal.
• The SEC’s 2026 tokenization rules, from a January statement on tokenized securities to an August proposal easing token fundraising, are built around U.S. issuers and existing public markets, not foreign governments selling state assets abroad.
• Citigroup’s tokenized private-company shares, launched in June, are the clearest working example of tokenization reaching cross-border investors this year, but a bank issuing corporate shares is a different mechanism than a state tokenizing its own assets.

In a post on X this week, Changpeng Zhao argued that tokenizing assets, company stock, state-owned enterprises, “everything,” is one of the best ways for a country to raise money and attract foreign direct investment. “Which country/company won’t want to sell their (tokenized) stocks to everyone in the world?” he wrote, adding that he backs tokenization across every blockchain even though that approach fragments liquidity.

A Pitch He’s Made Before

This isn’t a new argument from Zhao. In January, at the World Economic Forum in Davos, he said he was in talks with “probably a dozen governments” about tokenizing state-owned assets, naming Pakistan, Malaysia and Kyrgyzstan as examples. In February, on a Binance Square AMA, he went further, floating gold, rare earth minerals and water as assets governments could tokenize to finance infrastructure. What exists so far is talks, alongside other recent discussions involving CZ Hyperliquid Trump.

What the Regulators Have Actually Built

The regulatory backdrop Zhao’s pitch depends on has moved, but not toward the use case he’s describing.

• January: The SEC’s Corporation Finance staff stated that tokenized securities remain subject to federal securities law regardless of their blockchain form.
• May: The agency was reported to be preparing an “innovation exemption” for tokenized stock trading, while SEC Chair Paul Atkins argued that existing rules do not fit blockchain-based systems.
• Mid-August: The proposed innovation exemption was reportedly delayed after opposition from Wall Street firms.
• August 18: The SEC formally proposed two narrower paths: a “startup exemption” for offerings up to $5 million over four years and a “fundraising exemption” for offerings up to $75 million a year.

Atkins described the approach as “common-sense regulation: minimum effective dose, maximum freedom to build, and durable clarity under existing law.”

None of that reaches what Zhao is pitching. Every one of those rules is written for U.S.-based token issuers or companies already trading on U.S. public markets. A government tokenizing a state-owned refinery or a sovereign bond to sell to investors abroad sits outside all four of them, in scale and in jurisdiction.

Where Tokenized Cross-Border Deals Do Exist

The closest real analog isn’t sovereign. In June, Citigroup launched Digital Depositary Receipts, tokenized shares of private companies, with its first transaction going to portfolio company Kaleido. Citi describes the product as reaching “global issuers and investors.”

That’s a bank tokenizing shares of a private company it already banks, not a state selling stakes in its own assets to foreign buyers, which is the specific mechanism Zhao keeps describing.

What Would Actually Change This

Zhao says the talks with governments are ongoing. None has surfaced publicly, and no regulator, in the U.S. or anywhere else, has published a framework built for a state to tokenize its own assets and sell them to foreign investors, despite other recent activity surrounding Changpeng Zhao Giggle Academy.