Part 4/10:
Maintaining the Peg: Demand-Driven Issuance
A critical feature of tokenized Tesla is its close trading relationship with the real Tesla stock. The system is designed to keep tokenized Tesla trading in “lockstep” with Tesla’s underlying price, with an aim to prevent wild deviations that could harm investors.
If tokenized Tesla trades below Tesla’s actual share price, the yield—interest paid to token holders—increases to attract buyers and maintain participation. Conversely, if it trades above Tesla, Leo Strategy can issue additional tokens via the ATM strategy, increasing the market cap proportionally to prevent a premium from forming and to preserve the peg’s integrity.