Metavesco, Inc. has released a position paper titled "Tokenizing the OTC: A Vision for Transparency, Liquidity, and Growth," proposing a framework to bring over-the-counter equities on-chain through blockchain technology. The company believes tokenization can fundamentally transform the OTC markets by addressing long-standing structural barriers that have plagued small public companies and their investors.
The OTC markets host thousands of small public companies that face significant challenges including lack of liquidity, limited access to growth capital, and an ecosystem dominated by toxic financing practices. According to Metavesco, most OTC tickers trade with minimal volume, leaving shareholders trapped and issuers unable to raise necessary growth capital. The market suffers from convertible note lenders preying on illiquid companies, manipulative schemes thriving in opaque environments, and a complete absence of Wall Street research coverage.
Tokenization offers a comprehensive solution by bringing OTC issuers and investors into the transparent environment of blockchain technology. The framework would enable tokenized shares to trade across borders, unlocking global liquidity beyond traditional U.S. broker-dealers. Every trade, issuance, and wallet would become visible on-chain, making naked shorting and hidden dilution impossible. Blockchain technology also provides significantly lower costs for issuers to distribute dividends and other rewards to shareholders.
The proposed system would reduce dependence on toxic financing by opening new fundraising tools including on-chain raises, smart contracts, and global retail access. Perhaps most innovatively, the blockchain would enable community-driven analysis, turning the investing public into analysts through transparent on-chain metrics tracking. Metavesco, as a public company actively engaged in digital assets and Web3 innovation, positions itself to champion this transformation for OTC issuers.
The company's vision centers on creating a marketplace where every small public company has fair access to liquidity and capital. Their mission involves working with regulators, innovators, and investors to develop responsible frameworks for bringing OTC securities on-chain. Metavesco will participate in an SEC roundtable with Commissioner Hester Peirce on September 4, 2025, to discuss regulatory barriers and opportunities in the digital asset space, focusing specifically on advocating for tokenization as the path forward for OTC issuers and investors.
This proposal represents a potential paradigm shift for capital markets that have long dismissed the OTC as the "Wild West" of investing. By leveraging blockchain transparency and global accessibility, tokenization could fundamentally level the playing field for small public companies and their investors while addressing systemic issues that have persisted for decades in over-the-counter trading environments.
