A European investor sees an opportunity in a tokenized US stock on Saturday night. A trading venue is open and the shares are available. The investor can buy and potentially settle them almost instantaneously. But the stock is priced in dollars and the investor holds euros.
Where do the dollars come from?
As tokenization extends the trading day for global equities, the lack of institutional-grade FX liquidity outside conventional currency market hours may constrain continuous cross-border trading.
A conventional US equity transaction settles on the business day after the trade. Tokenization—the digital representation of an asset on a distributed ledger, or blockchain—offers the possibility of trading and settling equities almost instantaneously outside traditional market hours.
Large-scale tokenized equity trading is getting closer.
Nasdaq, the New York-based exchange operator, and Payward, parent of crypto exchange Kraken, expect to launch Nasdaq Equity Tokens (NETs) in the second quarter of 2027. NETs are blockchain-based representations of traditional public equities. The New York Stock Exchange and its parent company, Intercontinental Exchange, also are developing tokenized trading infrastructure. The broader ambition is always-on global trading with on-chain settlement.
In an important regulatory move, on September 17, 2026, the US Securities and Exchange Commission granted temporary, conditional relief allowing qualifying tokenized securities venues to trade certain tokenized US stocks on public blockchains.
Tokenized settlement can be atomic: the cash and asset legs are linked so that either both occur or neither does. Other conditions, such as ownership verification, anti-money laundering checks and payment availability, can be built into the transaction. This structure reduces the risk that one party delivers while the other fails to fulfill its obligation.
Atomic settlement answers the question of whether an equity and its payment can change hands simultaneously. But if a foreign exchange transaction is also needed, can the investor obtain currency outside conventional market hours?
Foreign exchange is often described as an around-the-clock market. That’s largely true: trading opens Sunday at 5 pm Eastern Time and continues until Friday at 5 pm. But trading conditions are not uniform. Liquidity fluctuates and counterparties vary, especially near market opening and closing and as trading passes from one global region to another. Institutional weekend FX liquidity, if it can be found, is another matter altogether.
The existence of an FX price doesn’t mean there is sufficient depth to execute a large institutional transaction efficiently. An available price, in other words, doesn’t necessarily mean adequate liquidity.
A European investor wanting to buy dollars on Saturday night to purchase a US stock confronts this liquidity shortfall. The investor must find a counterparty willing to accept euros in exchange for dollars. Potential counterparties include a global bank, a non-bank trading firm, the equity venue or one of its partners, a stablecoin or tokenized-deposit provider or, eventually, an on-chain liquidity pool.
No matter who provides the dollars, that provider faces a risk-management problem: how to hedge the euros it receives. In a thin Saturday-evening market, the provider might not be able to hedge that risk at a reasonable cost. The question therefore becomes: who warehouses the currency risk until deeper liquidity returns and at what cost?
A thin market can present the investor and its counterparty with unfavorable choices. If the market risk is too great, the investor could pay a premium for immediacy, selling euros at a bid well below the best rate visible on a trading screen.
If the order is large, the counterparty may be unwilling to buy all the euros the investor wants to sell. The investor may have to break the order into smaller pieces and trade with multiple counterparties. Other market participants, alerted by the unusual activity, might trade against the investor, increasing its trading cost.
Once the investor’s trade is complete, the euro market risk becomes the counterparty’s problem. The counterparty might look for an offsetting trade—or several—by finding participants willing to buy roughly the amount of euros it holds in exchange for dollars. But those traders, aware of poor liquidity conditions, might demand a high price to warehouse the risk.
Finally, the counterparty may hold the euros until the London market opens Monday morning and liquidity deepens. It may be willing to assume that market risk based on its analysis of the pre-weekend euro-dollar trend, macro data, news and other information that shapes its view of the likely opening price.
The investor may therefore face a counterintuitive situation: the stock is available continuously, but the currency conversion becomes the expensive part of the transaction.
Conventional FX banks could increase staffing and broaden operating hours, perhaps eventually extending services around the clock to match tokenized equity trading. Connecting conventional and digital systems is possible. But emerging approaches may provide more efficient or cost-effective ways to support continuous cross-border transactions:
These are intriguing solutions, but they share a limitation: changing the form of money doesn’t eliminate the economics of foreign exchange. Someone or some mechanism must exchange one currency for another at some rate and shoulder the risk created by an inventory imbalance.
Equity tokenization is hurtling toward commercial launch. When investors can trade stocks on Saturday, they’ll expect services that are commonplace in today’s conventional trading and settlement operations—such as currency conversion—to be available too.
Those expectations could create opportunities for FX providers able to offer currency trading, settlement and reliable liquidity outside conventional market hours.
But racing to be first doesn’t just mean running today’s processes for longer hours. Providers will need to solve problems involving pricing, inventory, hedging, credit, collateral and risk management during periods when underlying market depth is limited. Innovation may need to occur in liquidity provision as much as in trading technology.
The European investor may be able to use tokenization technology to buy a US stock on Saturday evening. But that doesn’t mean the investor can obtain the dollars for settlement at a reasonable cost and in time to meet the settlement timetable.
Tokenization promises to loosen the connection between markets and the clock. But cross-border equity investing involves two markets—the market for the stock and the market for the currency used to buy it. If equities become tradable 24/7 while currencies do not, FX liquidity may determine just how continuous global capital markets can really become.
As tokenization extends the trading day for global equities, the lack of institutional-grade FX liquidity outside conventional currency market hours may constrain continuous cross-border trading.
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