zMAG7 explained: tokenized US stocks for the Global South

Seven companies now account for roughly a third of the total market capitalisation of the S&P 500. Their products run the phones, the cloud infrastructure, the advertising and the AI systems that most of the world already uses daily. Ownership of them has stayed concentrated among people with direct access to US capital markets.

Tokenized equity is supposed to change that. Most of it does not, because most of what carries the label is a price feed with a payout promise attached, and the gap only shows itself at the moment you need the thing to be real.

So the question worth asking of any product in this category is narrow: what sits behind the token, who holds it, and what happens when you want out. Here are those answers for zMAG7, with the mechanics rather than the pitch.

Two layers, and the difference matters

zMAG7 is a vault. It holds seven things, and those seven things are where the backing lives.

Each of the Magnificent Seven trades on Base as its own Coinbase Tokenized Stock: AAPLc, AMZNc, GOOGLc, METAc, MSFTc, NVDAc and TSLAc. Coinbase Onchain SPV Ltd issues them. Each one is backed 1:1 by a real listed share held with a regulated custodian.

zMAG7 holds those seven tokens in equal weight and issues you a single balance representing your slice of the basket. One position, one transaction, one thing to watch, with seven companies underneath it.

Keeping the two layers straight is what lets you evaluate the product properly. The vault is Zoth’s. The share backing belongs to the tokenized stock, and that is verifiable independently of anything Zoth says about it.

Inside a Coinbase tokenized stock

This is the layer most explainers skip, and it is the one that decides whether the rest of the product is worth anything.

Each tokenized stock is issued as a B20 token, an extension of ERC-20 built for real-world assets. Onchain, each is identified by its contract address rather than its ticker, which is the detail that stops a convincing fake from passing as AAPLc.

At issuance, one token equals one share. From there the relationship is maintained by a multiplier rather than by minting new tokens. When a corporate action happens, a dividend or a stock split, the multiplier adjusts and the redeemable value behind each token changes while your token count stays the same.

That design is worth understanding before you hold one. You will never see extra tokens appear in your wallet. What changes is what each token is worth against the underlying.

Pricing comes from Chainlink total return feeds.

What happens to dividends

Seven companies, most of them paying dividends. The money goes somewhere, and on most tokenized equity products it is genuinely hard to find out where.

On zMAG7 it is reinvested. When a dividend is paid, it buys additional underlying shares, and the multiplier on the tokenized stock moves to reflect them. The redeemable value behind each token rises. Your token balance stays exactly as it was.

So your zMAG7 count will never change on a dividend date. What changes is what each one is worth when you redeem. Stock splits and other corporate actions run through the same mechanism.

Two things follow from that, and the second one is the part worth deciding on before you deposit.

Reinvestment compounds the position without you acting on it, and it keeps the basket at its weighting instead of leaving dividend cash sitting outside the allocation waiting to be redeployed.

It also means no income. If you are holding for a quarterly payout, this is the wrong product, and that is better known now than discovered in March.

Equal weight, and the three-day cycle

zMAG7 holds all seven at equal weight, 14.3% each.

Weights move the moment the market does. NVIDIA has a strong session, its share of the basket rises, and every other holding falls as a proportion. Left alone for a few months, an equal-weight basket becomes a concentrated bet on whichever name runs hardest.

zMAG7 rebalances every three days, bringing the weights back to equal. Between rebalances the live allocation sits either side of 14.3%, and you can see exactly where on the vault page at any moment.

Three days is a deliberate choice. Rebalance constantly and you spend the basket’s value on transaction costs. Rebalance quarterly and you spend months holding an allocation you did not choose. The cycle is short enough that drift stays small and long enough that the basket is not churning.

What you own stays what you decided to own. That is the whole argument for a basket, and it is a narrower claim than most basket marketing makes.

Minting and redeeming

You mint with USDC on Base. The vault allocates equally across the seven tokens and your zMAG7 balance appears in the wallet you connected. Minting is instant and the minimum is one dollar.

Redemption is a request rather than a swap. You submit it on the vault page, it is processed on confirmation, and settlement takes roughly one to five days. You receive USDC at the basket value at settlement.

Read that twice before depositing, because it is the most important mechanical fact in this piece. The exit runs on a settlement window, and the value you receive is the value when it settles rather than when you asked.

One detail that most products leave you to discover: mint and redeem run at the same rate inverted. No spread is taken between the two legs.

What it costs

Nothing, for early users. Minting, redemption, management and performance fees are all currently waived.

The standard schedule behind the waiver is 0.25% to mint, 0.1% to redeem and 0.5% per annum management (waived off temporarily). Gas and other network fees are charged separately and always will be.

Zocta

Every dollar held in zMAG7 earns 10 Zocta a day. The vault page shows this as a boosted rate of up to 4%.

Zocta is Zoth’s rewards layer, earned by using the products. It has never been purchasable, which is the design working as intended: a rewards balance you can buy rewards capital, and this one is built to reward use.

Who can use it

zMAG7 is open to non-US persons in eligible jurisdictions. The vault interface blocks restricted regions, so eligibility is settled before a deposit happens.

That is worth defending as a design choice. A product that takes a deposit and then discovers a restriction has manufactured a refund, a support ticket and a permanent reason for doubt. Answer the question at the door instead.

Risks, stated properly

zMAG7 gives equity exposure. The value of a position moves with seven stocks and can fall, including below the amount deposited.

Concentration. Seven technology-focused companies move together more often than people expect. AI exposure touches six of the seven from different directions, which is the reason to hold the basket and also the reason a single shift in AI expectations can move all of it at once. This is a concentrated position in one theme. Size it accordingly.

Liquidity. Onchain liquidity can thin, particularly outside US market hours, as above.

Tracking. Token prices can diverge from the underlying share values through market conditions, oracle latency or failure, network outages, or smart contract issues.

Counterparty. The product depends on the issuer and custodian of the underlying tokens. USDC funding carries its own peg and issuer risk.

The vault contracts have been independently audited, with the auditors named on the vault page.

Why this matters outside the United States

The Magnificent Seven are global businesses. They earn in every market they operate in, including every market where holding a position in them has been difficult to arrange.

Someone in Lagos, Jakarta, São Paulo or Manila already uses these products and already generates revenue for these companies. Participating as an owner has been a separate question, answered by where they happen to hold an account.

zMAG7 does not fix financial exclusion and will not claim to. It opens one specific position to anyone already holding stablecoins, which is a narrow claim and a true one.

Start

zMAG7 is live at app.zoth.io/zvault/zmag7. The contract is public on Base, and the factsheet, terms and documentation are linked from the page.

One dollar, one deposit, seven companies.

zMAG7 gives equity exposure. Returns track the underlying stocks and the value of a position can fall, including below the amount deposited. There is no fixed yield. Fee waivers apply to early users and standard fees apply afterwards. Available to non-US persons in eligible jurisdictions. This is not investment advice.