Kraken enters the stock tokenization market, why are exchanges rushing to seize the track?

Author: 1912212.eth, Foresight News

On May 22, Kraken, an all-crypto exchange, announced that it will partner with Backed Finance to launch a tokenized stock and ETF trading service called "xStocks", the first batch of which covers more than 50 U.S.-listed stocks and ETFs such as Apple, Tesla, and Nvidia. In recent years, the integration of blockchain technology with traditional finance has been accelerating, and cryptocurrency exchanges are becoming the vanguard of this change. What used to be a movement to tokenize the dollar and Treasury bonds is now being pushed to U.S. equities by exchanges?

Strategic ExpansionFounded

in 2011, Kraken is one of the oldest cryptocurrency exchanges in the world, known for its security and compliance. In recent years, Kraken has continued to push the boundaries of its business as the crypto market has become more competitive. In 2024, Kraken acquired NinjaTrader, a futures trading platform, and launched more than 11,000 traditional trading services for U.S. stocks and ETFs in select U.S. states.

Tokenized stocks refer to the conversion of equity in traditional stocks or ETFs into digital tokens through blockchain technology, with each token representing a portion of ownership of the underlying asset. These tokens can be traded 24/7 on the blockchain, breaking through the trading hours and geographical restrictions of traditional stock markets. Kraken's xStocks, based on the Solana chain, are planned to be available to non-US customers across Europe, Latin America, Africa, and Asia. Backed Finance is responsible for acquiring and escrow the underlying shares, ensuring that each token is pegged 1:1 to a real asset, and holders can redeem the cash value of the token at any time.

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