In the summer of 2025, a silent revolution is taking place in the global fintech sector. The xStocks product launched by the Swiss compliant asset tokenization platform Backed Finance quickly gained support from leading trading platforms such as Gate.
This innovative product transforms 61 stocks, including Tesla, Apple, and Nvidia, into tokenized assets that can be traded 24/7 through blockchain technology, fundamentally restructuring the way global investors participate in the stock market.
Among them, the NVDAX, representing NVIDIA, has become one of the most watched assets in xStocks due to the strong performance of its underlying assets and its core position in the wave of artificial intelligence. This article will delve into the operational mechanism of xStocks and, using the Gate platform as an example, provide a detailed explanation of the entire purchasing process for NVDAX.
What is xStocks? Unveiling the veil of tokenization stocks
xStocks is an innovative financial product launched by the Swiss compliant fintech company Backed Finance, which essentially tokenizes stocks from traditional financial markets using blockchain technology. Each Token represents the stock of a listed company (such as Nvidia, Apple, Tesla) and is strictly backed by physical stocks at a 1:1 ratio.
These underlying stock assets are custodized by regulated third-party institutions—mainly Swiss banks such as InCore Bank and Maerki Baumann—to ensure asset transparency and verifiability.
The biggest difference from traditional stocks is that xStocks is issued in the form of SPL standard Token. Solana Public chains can also cross-chain to other mainstream public chains such as Ethereum, Avalanche, Base, etc. This technological foundation gives it three revolutionary characteristics:
- Round-the-clock trading: Break the trading time limitations of traditional stock markets from 9:30 AM to 4:00 PM ET, achieving uninterrupted trading 7×24 hours.
- Fractional investment mechanism: supports small investments of at least 10 USD, significantly lowering the participation threshold.
- On-chain free flow: tokens can be deposited into non-custodial wallets to participate in on-chain operations such as staking and lending in DeFi protocols.
But investors should be aware of key limitations: xStocks does not grant shareholders voting rights, cash dividends are distributed in the form of token airdrops, and currently, it primarily targets users in regions where it is not easy to open stock accounts.
The operational mechanism and core controversies of xStocks
Asset Anchoring and Token Minting
Backed Finance links the value of traditional stocks with on-chain tokens through precise design: first, it purchases real stocks through channels such as Interactive Brokers and deposits them into a segregated account at Clearstream, a subsidiary of Deutsche Börse; then, it mints corresponding tokens on the Solana chain at a 1:1 ratio (for example, 1000 shares of NVIDIA stock correspond to 1000 NVDAX tokens).
Price synchronization relies on Chainlink oracles to obtain real-time Nasdaq quotes, although on-chain transactions often exhibit a deviation of around 0.3%, creating operational space for arbitrageurs.
Legal Structure Essence
DigiFT analyst Ryan pointed out that xStocks tokens are essentially a form of corporate debt structure, rather than true equity tokens. This design avoids the registration process required for equity transfers, exempts the stamp duty burden, and allows the issuing entity to operate without custody qualifications.
This special structure explains why token holders do not have shareholder rights and also determines the way dividends are distributed—directly through token airdrops instead of traditional dividend payments.
Liquidity Challenges
Despite the novelty of the concept, xStocks still faces real challenges. On-chain data shows that trading activities are highly concentrated on star assets. According to Gate’s xStocks market data, on August 6, 2025, COINx ($8.46 million), GOOGLx ($5.39 million), and HOODx ($5.23 million) accounted for the vast majority of the total market share of all tokenized stocks listed on Gate.
Most underlying assets have low liquidity, and some trading pairs have significant slippage, especially during non-USD trading hours, where the bid-ask spread may widen to 3%, affecting the trading experience.
Why choose NVDAX? The on-chain investment value of Nvidia
Among the first tokens launched on xStocks, NVDAX, representing Nvidia, demonstrates unique configurational value. As a core leader in the field of artificial intelligence computing, Nvidia’s stock (NVDA) has always been a bellwether for technology stocks in the traditional stock market.
By trading NVDAX on the Gate platform, investors gain the following advantages:
- Lowering the entry threshold: Nvidia’s stock price has surpassed $1000 in July 2025, while NVDAX supports fractional investment starting from $10.
- Capture opportunities during non-trading hours: NVIDIA often releases significant product updates after the stock market closes, allowing for immediate responses to market changes through NVDAX.
- Diversification of hedging tools: Gate offers NVDAX/USDT perpetual contracts, supporting 1-10x leverage for both long and short positions, flexibly responding to market volatility.
Data from 2025 shows that the tokenized stock trading volume on the Gate platform increased by 150% year-on-year, with NVDAX becoming one of the most active assets due to the high growth potential of its underlying assets.
Step-by-step guide: How to purchase NVDAX on the Gate platform
As a leading global crypto trading platform, Gate will launch the xStocks trading area in July 2025, supporting both spot and contract trading. Below is the detailed process for purchasing NVDAX using Gate:
Preparation Work
- Account Registration: Visit Gate.com (the unified domain name after the brand upgrade in 2025) to complete registration
- Asset Recharge: Recharge USDT (recommended) or other supported crypto assets to your Gate spot account
- Regional Confirmation: Ensure the account is not in a restricted area
Web Purchase Process
- Log into your account and click on the 【Trading】 option in the top navigation bar to enter the trading interface.
- On the left side, select 【Spot】 or 【Contract】 section (first-time users are recommended to choose Spot).
- In the trading pair search box, enter "NVDAX" and select the NVDAX/USDT trading market.
- In the middle of the trading interface, select the order type:
- Market Order: Execute immediately at the best market price.
- Limit Order: Set a desired buying price and wait for matching.
- Take Profit and Stop Loss: Advanced strategy orders (suitable for volatile markets).
- Enter the purchase quantity (decimal purchases are supported), confirm the transaction fee, and submit the order.
App Mobile Operation
- Open the Gate App and click the bottom 【Trading】 icon
- Select the 【Spot】 tab at the top
- Click on the trading pair area, search for "NVDAX" and select the NVDAX/USDT market
- Enter the purchase quantity and type in the bottom trading panel, slide to confirm the order
Advanced Features
- Alpha Zone: Professional users can enter Gate Alpha to trade NVDAX, enjoying lower slippage and faster matching.
- Cross-Chain Transfer: After purchase, NVDAX can be transferred to non-custodial wallets that support the Solana chain (such as Solflare) to participate in the DeFi ecosystem.
- Contract Trading: Use leveraged trading for NVDAX in the 【Contract】 section, with a maximum support of 10x leverage (be mindful of risk management).
Gate will launch the "Trading Contest" event in July 2025 to promote the xStocks zone, where users who meet the daily trading volume requirements can receive rewards of up to 100 USDT. New users who complete their first trade will also receive a contract experience voucher and platform coin GT.
Opportunities and Risks Coexist: xStocks Investment Considerations
Core Advantage Analysis
- Borderless Participation: Users from regions with weak traditional stock services, such as Africa and Southeast Asia, can directly invest in high-quality global assets through cryptocurrency wallets.
- DeFi Ecosystem Integration: Users can provide NVDAX/USDT liquidity on platforms like Raydium to earn trading fees and rewards.
- Tax Optimization Potential: The tokenization structure avoids the registration requirements for equity transfers, exempting users from stamp duty in certain regions.
Risks That Cannot Be Ignored
- Liquidity Risk: Apart from popular assets (TSLAx, NVDAx, AAPLx), most xStocks have limited trading depth, and large transactions may face slippage.
- Missing Rights: Token holders have no voting rights at shareholder meetings, and participation in corporate governance is limited.
- Technical Dependence: Prices depend on oracle feeds, and temporary decoupling may occur during extreme market conditions.
Financial technology analysts point out that the rise of xStocks in 2025 represents the maturity of the "Asset Tokenization 2.0" wave. Compared to earlier purely algorithmic synthetic assets like Mirror Protocol, models characterized by physical collateral and compliant custody have significantly enhanced market confidence.
Industry Benchmark: The Future Evolution of Tokenized Securities
With the trading volume of xStocks steadily increasing on platforms like Gate, industry exploration is deepening along two paths:
Derivatives Path: Spot liquidity constraints have created demand for stock perpetual contracts ("stonk perps"). This type of derivative, which does not require physical delivery and relies on oracle pricing, is being tested first on decentralized platforms like Hypeliquid, offering high leverage and round-the-clock trading experiences, better suited to the habits of crypto users.
Tokenization of unlisted equity: On-chain equity circulation is seen as a revolution in early investment exit mechanisms. By tokenizing the equity of unlisted companies like SpaceX and OpenAI, combined with DAO governance and smart contract lock-up mechanisms, a more transparent private equity market can be built.
The background of the Backed Finance team has also drawn attention. The three co-founders participated in the DAOstack project, which raised $30 million in 2017-2018 but ultimately ended up shutting down. This history has become the focal point of community discussions, but the team successfully completed a $9.5 million Series A financing round in April 2024. Gnosis The lead investment shows that capital recognizes its new direction.
Future Outlook
As traditional fintech companies such as Coinbase and Robinhood gradually embrace blockchain clearing systems, the new trading form represented by xStocks is moving from the fringes to the mainstream. According to data from the Gate platform, the number of new user registrations in its xStocks section has increased by 200% year-on-year, with over $500 million worth of xStocks tokens entering the DeFi ecosystem through staking.
The future has arrived, but it is not evenly distributed. Whether the final form is a fleeting financial experiment or an on-chain entry to the traditional financial market, xStocks provides a window for global investors to observe the future of finance.
