Chapter 2: Industry Background and Pain Points

2.1 Theoretical Foundation for Cost Reduction and Efficiency Improvement & Blockchain Technology Application

Nobel laureate Ronald Coase's transaction cost economics theory reveals the significant impact of transaction costs on economic efficiency and resource allocation. From the perspective of human civilization development, all technologies that can reduce costs and increase efficiency inevitably become trends in industry development. The current financial system still has high transaction and information asymmetry costs, hindering the free flow of assets and efficient capital allocation. Blockchain technology, with its core features of distributed ledgers and smart contracts, naturally possesses attributes that reduce transaction costs:

• Transparent information on blockchain reduces information asymmetry, improving market transparency and transaction efficiency.
• Smart contracts automatically execute trading rules and compliance standards, reducing intermediary involvement and lowering negotiation and execution costs.
• Stablecoins and cross-chain asset transfers enable instant global payments, breaking through the time and cost bottlenecks of traditional cross-border settlements.
• Building decentralized trust mechanisms enhances trust between trading parties and reduces credit risk costs.

In 2025, major economies such as the United States have introduced multiple policies to support the development of the cryptocurrency industry. Global financial institutions such as JPMorgan Chase, Citibank, and BlackRock have applied blockchain to fund custody, cross-border payments, and securities tokenization, promoting comprehensive cost reduction and efficiency improvement in the financial industry and deepening the digital transformation of the financial system.

2.2 Premium Attributes of Stock Assets and Global Investment Barriers

The stock market is one of the largest and most innovative capital markets in the world. Many technology giants such as Tesla, NVIDIA, Google, and Apple not only play a core leading role in technological innovation and industrial transformation but also bring considerable long-term value and stable returns to investors. The liquidity and market depth of stocks make them the preferred choice for global capital allocation. However, in reality, global investors still face many restrictions when participating in the stock market:

• High investment thresholds, with complex account opening processes, creating significant barriers for ordinary investors and global users.
• Restricted cross-border capital flows, affected by regulatory policies, foreign exchange controls, settlement mechanisms, and other factors in various countries, limiting accessibility and efficiency.
• Poor information channels, with a huge information gap for global users to deeply understand stock market information, lacking user education.

These barriers limit the global circulation efficiency of high-quality assets and constrain the depth and breadth expansion of capital markets.

2.3 Structural Shortcomings of the Digital Asset Market

Although the digital asset market has developed rapidly, the lack of sufficient high-quality on-chain assets remains a major pain point for industry development:

• The emergence of a large number of meme coins and concept coins without substantial asset backing, with strong speculation, leading to insufficient overall market confidence and hindering the inflow of healthy capital.
• Insufficient participation of high-quality assets and mainstream institutions, with limited market capital volume, lacking sufficient liquidity to support price discovery and risk management.
• Incomplete compliance and asset custody systems, with investment security and legal risks becoming potential hazards, constraining the deep advancement of asset tokenization.

These structural shortcomings hinder the integration of digital assets into mainstream financial markets, affecting investors' acceptance and trust in digital markets.

2.4 Inevitable Trend of Stock Asset Digitization and MSX Strategic Opportunity

With the development of blockchain technology and the gradual clarification of regulatory environments, asset digitization and on-chain trading have become inevitable trends in the digital finance era. The on-chain implementation of stock asset securitization not only meets investors' demand for convenient access to high-quality assets but also promotes the efficiency improvement of global capital markets. MSX keenly captures this pulse of the times, precisely positioning itself as a decentralized stock token asset trading platform, combining strict asset custody standards and a comprehensive compliance system to build a globally leading RWA ecosystem:

• Adopting blockchain smart contract technology to achieve low-cost, high-efficiency transaction matching and asset circulation.
• Through stablecoin trading and cross-chain bridge technology to ensure barrier-free and efficient global capital flows.
• Fulfilling 1:1 asset backing and transparent custody commitments to enhance investor confidence.
• Promoting diversified product layouts to meet multi-dimensional market investment needs.
• Achieving explosive growth in user numbers and trading volume, fully validating strategic choices and market value.

MSX's success is not only a victory of technological application and business model but also an exemplar of blockchain technology leading the transformation of financial asset flows, marking the arrival of a new generation of digital capital markets.

Stock Tokenization Model Comparison Table

Comparison Item	Traditional Brokers	CeFi Stock Tokenization	MSX (DeFi-RWA Stock Tokenization)
Liquidity	Relies on offline markets, slow matching	Market-making liquidity improvement, partially relies on centralized matching processes	Off-chain smart matching + PFOF, extreme depth, real-time execution
Transaction Costs	High, slow settlement, high cross-border fees	Reduced settlement costs, fast on-chain trading	Second-level settlement, low fees, on-chain clearing
Compliance	Strict securities regulation, limited compliance	Multiple licenses, cross-border restrictions	Multi-country licenses + compliance separation, globally scalable
User Barriers	Cumbersome account opening, information barriers	Fast online account opening, corresponding KYC	Zero barrier entry, wallet as identity, multi-chain interoperability
Investment Diversity	Mainly stocks/ETFs	Supports mainstream assets, but limited asset pool	Stock spot/perpetual/ETF/cross-chain various RWA
Security Mechanisms	Relies on traditional institutions/clearing houses	Platform security, contract audits need trust	Multi-sig, on-chain audits, oracle manipulation resistance, transparent clearing
Governance Incentives	Shareholder meetings, limited participation for ordinary users	Platform single governance, conducive to operations	Token governance + point seasons + multi-party participation, community-driven