Arch Lending is planning to introduce loans secured by tokenized equities. The company aims to capitalize on the growing market for on-chain stocks, where lenders are increasingly exploring new collateral options beyond traditional cryptocurrencies.
According to data from RWA.xyz, the value of distributed tokenized stocks has surged to approximately $3,15 billion, compared to roughly $630 million a year ago. Arch Lending CEO Sahay noted that while the sector is expanding, lending against these assets remains in its early stages.
Arch Lending has already begun diversifying its portfolio beyond digital assets. In recent weeks, the firm launched loan products backed by Paxos Gold and Tether Gold. Currently, Bitcoin remains the primary collateral for the company, representing over 80% of its total loan book.
The broader market for tokenized equities is seeing increased activity from various players. Ondo Finance integrated its tokenized ETFs with the Morpho protocol in February, allowing users to leverage SPDR S&P 500 and Invesco QQQ tokens as collateral on Ethereum.
Other platforms are also integrating tokenized stocks into their ecosystems. In July, Kraken enabled the use of 10 xStocks for futures and margin positions. Additionally, Coinbase launched its B20 stocks on the Base network in August, providing infrastructure to support DeFi lending and borrowing.
