Custody and Redemption

Every stock token is a claim on a share held somewhere by a real custodian — a regulated entity that holds the actual equity and is responsible for keeping the token supply matched to real holdings.

Minting typically happens when the custodian receives a new share and issues a corresponding token. Redemption runs the process in reverse: you send the token back, and — assuming everything works as designed — the custodian releases or sells the underlying share on your behalf.

In practice, redemption is often less immediate and less accessible than trading the token itself. There may be minimum sizes, processing windows, or eligibility restrictions that make redemption more like a traditional brokerage request than an instant on-chain swap.

This is the piece worth understanding before treating a stock token as interchangeable with owning the stock directly: the token's value depends on that custody-and-redemption chain continuing to function exactly as described.