Fairmint CEO Warns Tokenized Stocks Could Echo 1960s Paper Crisis
Joris Delanoue says fragmented standards in tokenized securities may recreate Wall Street's 1960s paperwork crunch.
The CEO of Fairmint, Joris Delanoue, has cautioned that the tokenized stock market could face a crisis similar to the one that disrupted Wall Street in the 1960s if industry players continue to operate with fragmented systems and inconsistent standards.
The 1960s paper crisis was triggered by surging trading volumes that overwhelmed the manual processing of physical stock certificates, leading to backlogs, errors, and eventually regulatory reforms. Delanoue reportedly sees parallels today, as different platforms and protocols for tokenized securities are not yet fully interoperable.
Key concerns
- Lack of uniform technical standards across tokenized stock offerings
- Fragmented settlement and custody systems between platforms
- Operational risks that could emerge as trading volume increases
The warning comes as tokenization of traditional assets gains traction, with banks and startups experimenting with blockchain-based shares. Delanoue's remarks highlight the need for industry-wide coordination and regulatory clarity to avoid the infrastructure bottlenecks of the past.