In case you thought that blockchain was just for crypto, Nasdaq may want to have a word.

It petitioned the Securities and Exchange Commission Monday for permission to tokenize US securities, including stocks and exchange-traded products. The setup it’s proposing would allow investors to choose how their trades are executed: the traditional way or via a distributed ledger. If they choose the latter, the Depository Trust Corporation would handle the backend work to clear and settle, recording assets on the blockchain.

“We’re already living in a digital world,” Chuck Mack, senior vice president of North American Markets for Nasdaq, said in an announcement. “Stocks and other securities today are represented and recorded through digital means, so tokenization is just a different method of digitally representing an asset.”

Different, But the Same

Whether in traditional or tokenized form, shares would trade with the same order entry, follow the same executive rules and use the same market identification numbers, according to Nasdaq. Tokenized assets would also provide the same shareholder rights as traditional shares, the company said. But the blockchain has efficiencies such as faster settlements and better audit trails, Mack said.

Trading US equities in tokenized form is new and is already happening on some platforms, albeit for non-US investors:

• Robinhood added tokenized access in July to 200 US ETFs and stocks for European clients.
• Kraken began a “phased rollout” of tokenized trading for US stock and ETFs in late June, starting with 60 securities available for eligible non-US clients.

Timing Is Everything: “Frankly, this seems designed to enlist the new SEC Atkins’ team and its crypto-friendly agenda,” said Bill Singer, a veteran Wall Street regulatory lawyer. Pending SEC approval, tokenized trading could begin on the Nasdaq as soon as the third quarter of 2026 — but there will be some obstacles, Singer said. There will almost certainly be debate on several aspects of the proposal, including getting infrastructure ready by that time, developing standards for metadata, piloting smaller asset classes, promoting transparency and liquidity and ensuring tokenized assets are legally recognized across different systems by the SEC, Commodity Futures Trading Commission and the Treasury Department’s Financial Crimes Enforcement Network, he said. Investor advocates may also counter that tokenization is just hype without any actual benefits, he said. “If the pushback and caution gain traction, a system-wide tokenization overhaul is unlikely to happen soon,” he said.

First, the gloomy news: A jobs-data revision yesterday from the US Labor Department showed that 911,000 fewer positions were added in the 12 months through March than previously estimated. That’s a bigger dip than even most pessimists had predicted, triggering fears of a recession.

But what if the revision is the final clue revealing the US economy has already been in recession for a couple of years, and that we may be in a recovery? That’s not some wild Reddit conspiracy. It’s the theory posited in a splashy new research note from Morgan Stanley.

Rolling With the Punches

Let’s flashback to 2022. In late July, the US Bureau of Economic Analysis reported that the US economy contracted 0.9% in the second quarter of the year, following a 1.6% contraction in the first quarter. It triggered widespread questioning over whether the US economy had tipped into recession territory. After all, every period of two consecutive quarters of negative growth has coincided with a recession in the US since 1948. But the National Bureau of Economic Research (NBER), the official arbiter of the recession question, never declared one. US GDP returned to growth by the third quarter (and the bureau later revised Q2 numbers to show a small amount of growth as well), and the recession narrative gave way to debate about stamping out inflation without triggering a recession.

But a team of Morgan Stanley analysts led by chief US equity strategist and CIO Mike Wilson says the first recorders of history got it wrong. The reason few noticed, they posit, is that the US has been in a “rolling recession,” with different sectors passing through periods of contraction at their own pace. The downturn was also obscured by strong post-COVID consumer spending as well as “over-hiring for the past few years” in the public sector, “somewhat masking” underlying weakness in the private sector.

The good news? There may be signs that the “rolling recession” is coming to an end — and more rocking times are soon to come (not for nothing are we called The Daily Upside):

• “We’re not of the view that a rapid/acute rise in the unemployment rate and/or significantly negative payroll numbers are coming,” the analysts wrote, noting that some signals point to “Liberation Day” in April marking the rock bottom of the jobs market, with a recent upward revision to jobs data in July showing that a rebound may be underway, barring “another shock to the economy.”
• The analysts also pointed to median Russell 3000 companies returning to earnings growth this summer, after a sojourn in the wilderness since 2021, as a sign of recovery, as well as a so-called V-shaped recovery to earnings share breadth in the S&P 500.

Fed Up: Recession or not, Tuesday’s jobs revision has traders now all but certain of a quarter-point rate cut by the Federal Reserve during its meeting next week, likely followed by at least one more quarter-point cut later this year, according to CME Group’s FedWatch tool.

Wait just a minute: Better put on your white gloves before you take that meeting.

Whether a firm is a family office or not, clients are increasingly looking for family office treatment. Expanded services are driving where high-net-worth and ultra-high-net-worth clients choose to park their assets, according to a report from Cerulli last week. The industry researcher also projects that by 2028, the total advisor-managed HNW industry will surpass $30 trillion in AUM.

In a market based on survival of the fittest, firms with the broadest offerings are expected to come out on top. “As AUM grows, so does the complexity of our client needs,” said Jeremiah Barlow, head of wealth solutions at Mercer Advisors. “Firms that invest in technology, talent and a client-first culture will be best positioned to thrive.”

Special Treatment

Returns and portfolio performance will always remain central, but firms are expected to spend less time on day-to-day investment management and more on services, said Chayce Horton, associate director of wealth management at Cerulli. “They’re looking for ways to centralize portfolio construction and move it off the core advisor’s plate,” he told Advisor Upside.

The shift is already underway. In 2024, firms serving HNW clients offered an average of 12 services, up from 10 in 2017, Cerulli found:

• Trust administration and private banking jumped from 42% and 34% of firms, respectively, to 61% and 59%.
• Roughly three-fourths now offer estate planning, up from 56%.
• Tax planning climbed to nearly 40% of practices, from about 30% in 2017.

One offering that’s losing steam, however, is concierge service. “It’s everything that a client who has a bunch of money and doesn’t know exactly where to go might ask for,” Horton said, adding that it includes buying vintage wine and fine art, booking private jets and finding dog walkers. “As you can imagine, it’s very time-intensive,” he said.

No Free Lunch. Adding services raises two big questions: Who will deliver them, and who will pay? Staffing is often a balancing act, said Andrew Larsen, analyst at Cerulli. “We’ve seen practices take outsourced services in-house and hire, but also the opposite, where advisors realize they don’t have the bandwidth and outsource instead,” he told Advisor Upside.

On pricing, some firms are moving beyond traditional asset-based fees. “The amount of revenue from financial planning fees has grown consistently,” Larsen said. “It’s still not a large slice of the pie, but it’s becoming more important.”