VALR has listed xStocks, tokenized representations of traditional U.S. equities. We make it easy for you to buy, sell, convert, and securely hold xStocks alongside your other crypto in your VALR wallet.
1. Getting Started
What are xStocks?
xStocks are tokenized representations of real-world U.S. stocks on the Solana blockchain. In other words, they are crypto tokens that aim to provide price exposure to a real-world asset. Each token is accessible via centralized and decentralized crypto exchanges and top DeFi protocols.
VALR is not the issuer of xStocks and merely provides a platform for willing buyers and sellers to trade xStocks as per any other crypto asset on VALR’s platform. VALR is therefore a secondary market for customers to easily trade the tokenized equities.
This allows VALR customers to diversify their portfolios and benefit from on-chain 24/7 liquidity and accessibility.
Who can trade xStocks on VALR?
Currently, only customers who reside in South Africa are eligible to trade xStocks on VALR’s platform.
We are actively working to expand the availability of xStocks to other regions and will announce any updates as they become available.
How can I buy xStocks on VALR?
xStocks will be available with full trading functionality, both through Simple Buy/Sell and spot orderbooks on the VALR Exchange.
xStocks pairs will be quoted against USDT. You can either fund your account with USDT or purchase USDT to trade xStocks directly on the VALR exchange. Simple Buy/Sell supports buying or selling xStocks with USDT, USDC, ZAR or BTC.
xStocks are available for trade 24/7 on VALR.
What trading pairs are available as xStocks on VALR?
At launch, VALR will offer 5 assets, representing companies such as Circle (CRCLX), Coinbase (COINX), NVIDIA (NVDAX), Robinhood (HOODX) and Tesla (TSLAX).
We are planning on expanding the available xStocks, with more to follow in the coming months.
What are the fees to trade the xStocks?
Trading fees on xStocks are charged at the same rate as all Spot Crypto quote pairs on VALR. Our charges can be viewed here.
Can I deposit or withdraw xStocks?
Yes, deposits and withdrawals of xStocks will be available via the Solana (SOL) network. Please ensure that you withdraw your xStocks to a compatible on-chain wallet.
What are the minimum and maximum order value or quantity of xStocks tokens?
You can refer to the order quantity and order value requirements on the Exchange page, or through our API here.
2. Understanding xStocks
Is purchasing xStocks the same as an investment in equities?
No. Purchasing xStocks is not the same as a direct equity investment in any of the underlying equities as xStocks merely reflect pricing exposure to certain U.S. equities.
Holders of the xStocks tokens do not possess any of the typical rights held by a shareholder. This means that holders do not have any ownership rights, voting rights, dividend entitlements, shareholder privileges, rights offerings or legal claims to the underlying company shares or any residual assets in the event of the underlying company’s liquidation. Further, holding xStocks does not entitle you to receive any information from the respective issuer or sponsor of the underlying stocks or shares.
As per the above, holders of xStocks are not entitled to, or have any rights to, any dividends. In the event that a dividend is paid out in relation to an underlying stock, the issuer of xStocks may rebase the supply by issuing additional tokens to token holders (similar to an airdrop). VALR may distribute these tokens to customers on VALR, however, this will be done on a best efforts basis only. VALR does not guarantee that any additional issuance by the issuer of xStocks will be distributed to customers.
How are xStocks tokens priced and does the price always match the underlying asset?
The price of xStocks on VALR is primarily dependent on market forces and how the market values the tokens based on supply and demand dynamics between a willing buyer and a willing seller on VALR’s platform.
While xStocks are designed to track the price of their underlying U.S. equities, their price on VALR may differ from the underlying assets price from time to time. This may be due to several reasons including, but not limited to:
24/7 availability: Unlike traditional stock markets, xStocks can be traded on VALR around the clock. This means price movements may occur during off-market hours for the underlying asset, leading to temporary differences.
Market Liquidity: Low trading volume for a particular xStock token can lead to price deviations.
Market Disruptions or Stock Halts: If the underlying stock is halted or suspended on traditional exchanges, xStocks may still be traded on VALR. This may result in a divergence between the price of the halted stock and the xStocks token that is still being traded.
Extreme Market Conditions: During "black swan" events, major geopolitical shocks, or market crashes, rapid and significant price movements can cause significant divergence.
How are xStocks tokens backed and does VALR custody the underlying stock?
xStocks tokens are designed to be fully collateralized on a 1:1 basis by the corresponding real-world U.S. equities.
For every xStock token issued, the issuer acquires and securely holds an equivalent share of the underlying stock with a regulated, independent custodian on behalf of the issuer or its designated trustee. The issuer then mints an equivalent number of xStock tokens, which are then made available for trading. The issuer of xStocks is Backed Assets (JE) Limited (a Jersey private limited company).
Importantly, VALR does not custody the underlying stock and VALR is not the issuer of xStocks. We merely provide a platform for willing buyers and sellers to trade these tokenized assets and our role is that of a secondary market.
Can I redeem xStocks tokens on VALR?
No, xStocks are not available for redemption on VALR. VALR only serves as a secondary market for our customers to buy and sell xStocks.
Does VALR provide investment advice on xStocks?
No. VALR does not provide investment advice, and none of the information on our website or any of our correspondence with you should be interpreted as such. It is essential that you conduct your own thorough research and fully understand the specific features and risks of xStocks before you begin trading. We strongly recommend seeking independent financial advice tailored to your personal circumstances. Past performance is not indicative of future returns.
Further Information on the Issuer
xStocks are a line of tokenised equities and ETFs launched and tokenised by Backed Finance, providing compliant, 1:1-backed tokenised equities available across multiple exchanges and blockchain ecosystems. For more information, visit https://xstocks.com
Disclaimer:
Trading or investing in crypto assets (including tokenised stocks) is risky and may result in the loss of capital as the value may fluctuate. VALR (Pty) Ltd is a licensed financial services provider (FSP #53308).
xStocks and tokenised stocks do not represent actual ownership of the underlying stocks, and holding xStocks does not entitle you to any dividend rights, interest, voting rights, redemption rights, shareholder privileges, rights offerings or any legal claims to the company shares or any residual assets in the event of the underlying company’s liquidation. xStocks and tokenised stocks are intended for trading purposes only and may not reflect real-time stock prices. Past performance is not indicative of future returns. Trading xStocks involves risks, including potential price deviations from the underlying assets due to market conditions, liquidity, pricing mechanisms, or issuer adjustments.
Trading xStocks is subject to VALR Tokenised Stocks Terms of Service as well as our general terms of service. Jurisdictional restrictions apply.
Please refer to VALR’s full set of risk disclosures found here.