Arch Lending wants to put your tokenized stocks on layaway 📈

Crypto lender Arch Lending is preparing to enter the market for loans backed by tokenized equities, with co-founder and chief revenue officer Himanshu Sahay telling Cointelegraph's Chain Reaction podcast that the firm plans to launch the product "pretty soon" because of growing demand for credit against the assets. Sahay said tokenized equities have expanded rapidly over the past year, but lending against them remains limited, and predicted that multiple lenders will eventually participate. He cited tokenized stock products from Superstate, Robinhood and Securitize as examples of the assets that could anchor the new credit market.

Arch has already moved beyond pure crypto collateral, launching loans backed by Paxos Gold and Tether Gold in recent weeks, according to Sahay. Cryptocurrencies still dominate its loan book, with Bitcoin ($BTC) accounting for more than 80% of outstanding loans, and Sahay said the lender has recently seen rising interest in XRP as collateral, particularly from US borrowers. The planned tokenized-equity product would add a third category of real-world assets to its offerings alongside those gold-backed loans.

Arch would not be the first to court tokenized stock collateral. In February, Ondo Finance launched DeFi lending markets for two of its tokenized ETFs through an integration with Morpho, allowing holders of tokenized versions of the SPDR S&P 500 ETF and the Invesco QQQ to borrow against them on Ethereum. Kraken made 10 xStocks eligible to back futures and margin positions in July, and Coinbase's B20 stocks launched on Base in August with price-feed infrastructure designed to support uses including DeFi borrowing and lending.

The broader tokenized equities market has grown sharply over the past year, with distributed tokenized stock value climbing to about $3.15 billion from roughly $630 million, according to data from RWA.xyz. That expansion is now being met with a parallel build-out of credit, derivatives and margin products that treat onchain stocks as usable balance-sheet assets rather than purely speculative instruments.