{"id":5519,"date":"2026-04-17T21:41:17","date_gmt":"2026-04-17T21:41:17","guid":{"rendered":"https:\/\/business.cornell.edu\/centers\/2026\/04\/17\/bullish-on-tokenized-emerging-markets\/"},"modified":"2026-07-14T18:14:04","modified_gmt":"2026-07-14T18:14:04","slug":"bullish-on-tokenized-emerging-markets","status":"publish","type":"post","link":"https:\/\/business.cornell.edu\/centers\/2026\/04\/17\/bullish-on-tokenized-emerging-markets\/","title":{"rendered":"Bullish on tokenized emerging markets"},"content":{"rendered":"\n\n<\/head>

For emerging markets, 2025 was an inflection point, as the MSCI Emerging Markets Index<\/a> gained 33.6%, outperforming the S&P 500’s 17.9% gain<\/a>.<\/p>\n\n\n\n

Using data from the MSCI Index<\/a>, which tracks equity market performance across emerging markets, the outperformance is striking: Colombia gained 112%, South Korea 100%, Poland 75%, Nigeria 57%, Egypt 59%, Mexico 56% and Brazil 49%.<\/p>\n\n\n\n

Based on research from Lourdes Casanova and Anne Miroux in Cornell’s 2025 Emerging Markets Institute annual report<\/a>, foreign direct investment in the E20+1 — the top 20 emerging economies plus China — has more than quadrupled since 2000.<\/p>\n\n\n\n

This capital flows almost entirely through institutional channels, sovereign funds and greenfield projects. Retail investors are largely locked out.<\/p>\n\n\n\n

There are over 20,000<\/a> publicly listed companies across emerging markets. U.S. investors can access less than 2% of them through domestic exchanges. U.S. households hold over $61 trillion in equities<\/a>, almost all concentrated in U.S. markets.<\/p>\n\n\n\n

Emerging markets produced the highest equity returns in 2025, yet the vast majority of the world’s investors had no way to buy them directly.<\/p>\n\n\n\n

The access gap for retail investors<\/h2>\n\n\n\n

Capital is not meant to be behind gated walls. Some of the best-performing stocks in the world are not listed on any major U.S. exchange. SK Hynix<\/a>, a South Korean semiconductor company, gained 229% in 2025. Samsung Electronics<\/a>, one of the world’s largest chipmakers, gained 115%. Reliance Industries<\/a>, India’s most valuable company at over $200 billion in market capitalization, faces the same problem. India’s stock market is the fifth-largest in the world, with a total market capitalization of over $5 trillion, yet almost none of its nearly 6,000 publicly listed companies are accessible to U.S. retail investors.<\/p>\n\n\n\n

These stocks are technically available to trade over the counter (OTC), but OTC markets are designed for institutional investors and are unavailable on retail platforms like Robinhood. Most retail investors don’t even know they exist. The only practical alternative is a country-specific exchange-traded fund (ETF) that bundles these stocks with dozens of others, diluting the very bet an investor wants to make.<\/p>\n\n\n\n

The access gap isn’t just a U.S. problem. Emerging markets represent 27% of global equity market capitalization<\/a>, roughly $40 trillion (Goldman Sachs), yet for retail investors, the cross-border infrastructure between emerging markets simply doesn’t exist. A retail investor in India has no practical way to buy a Colombian stock. A Brazilian has no practical way to buy a Korean stock. A Nigerian has no practical way to invest in the Indian market. When capital can’t move freely, everyone loses: Companies miss out on investment; investors miss out on returns; and economies miss out on growth.<\/p>\n\n\n\n

Tokenized equities gaining steam<\/h2>\n\n\n\n

Tokenized equities have generated over $20 billion in cumulative trading volume<\/a>, and investors hold over $1 billion in tokenized stocks globally. All of the most popular tokenized stocks by total value are U.S. equities: Alphabet ($72 million), Tesla ($65 million) and Nvidia ($49 million)<\/a>.<\/p>\n\n\n\n

The vast majority of tokenized stocks are not available to U.S. investors. Ondo Global Markets<\/a> and Kraken’s xStocks<\/a>, which together represent roughly 80% of the market<\/a>, operate under Regulation S, a U.S. securities exemption that excludes American investors entirely. Their users span Latin America, Africa, Europe and Asia.<\/p>\n\n\n\n

The irony is that while the demand for tokenized equities is being driven by emerging market investors, the flow is entirely one-directional. Every tokenized stock on the market today is a U.S. equity. Nobody is tokenizing emerging market stocks.<\/p>\n\n\n\n

A new capital channel for emerging market companies<\/h2>\n\n\n\n

For emerging market companies, tokenized equities offer something that has historically been out of reach: access to a global investor base without the cost and complexity of a foreign exchange listing. Tokenization doesn’t require companies to abandon traditional capital markets. It extends them. An emerging market company going public on its domestic exchange could simultaneously offer a tokenized tranche settled in stablecoins, opening a second distribution channel to global investors without altering the underlying offering structure.<\/p>\n\n\n\n

Benefits of tokenized equities to emerging market companies<\/h2>\n\n\n\n