Kraken plans to tokenize and allow trading for about 50 Stocks and ETFs, including those of Apple, Tesla, and Nvidia, atop the Solana blockchain.
The Wall Street Journal recently reported that Kraken, a major U.S.-based crypto exchange, is preparing to launch a new service that will let international users trade tokenized versions of over 50 popular stocks and ETFs. Among the big names on the list are Apple, Tesla, and Nvidia.
Kraken to Leverage Solana for Tokenized Stocks
Notably, the service will roll out in markets across Europe, Latin America, Africa, and Asia in the coming weeks. However, the exchange has confirmed that it will not be available in the U.S.
These digital tokens, which Kraken calls “xStocks,” will be based on the Solana blockchain. Each token will represent a real share of the stock or ETF it tracks.
Kraken’s partner, Backed Finance, will buy and hold the actual stocks to back the tokens. For clarity, users will not own the physical shares themselves but can redeem the tokens for their cash value, helping keep prices in line with those of the real stocks.
Remarkably, what sets this apart from traditional investing is that these tokens can be traded 24/7, even when U.S. stock markets are closed. Kraken says the goal is to give investors outside the U.S. a more affordable and flexible way to access American markets.
Solving an Accessibility Problem
According to the Wall Street Journal, Kraken’s co-CEO, Arjun Sethi, pointed out that buying U.S. stocks from abroad often involves high fees and long processing times. This new setup seeks to address that.
Kraken’s plan also includes giving users more freedom over how they use these tokenized stocks. Eventually, investors may be able to move the tokens to personal crypto wallets or even use them on other platforms. Some might even use tokenized shares as collateral in crypto trading strategies.
Interestingly, this kind of idea is not entirely new, as Binance launched a similar project in 2021 but shut it down soon after due to regulatory pressure. However, Kraken says it is working with local regulators to avoid those same issues.
According to The Wall Street Journal, the company is actively trying to make sure the rollout meets the legal requirements in each country where the service will be available.
Growing Tokenization Trends
Meanwhile, Kraken’s announcement is just one piece of a much bigger trend. Over the past year, some of the world’s biggest financial institutions have been moving into tokenized assets.
In March 2024, BlackRock launched a digital liquidity fund on Ethereum that captured 30% of the $1.3 billion tokenized Treasury market in just six weeks. By July, that fund held $486 million in assets. Meanwhile, Citi partnered with SDX to explore tokenizing private equity, and HSBC launched tokenized gold for retail investors in Hong Kong.
Other major institutions like Goldman Sachs, JPMorgan, and Nasdaq are also getting involved. JPMorgan’s Onyx blockchain supports tokenized Treasuries and interbank payments, while Nasdaq teamed up with Verta to help bring tokenized assets into mainstream financial markets.
JPMorgan also completed its first public tokenized Treasury transaction on Ondo earlier this month. Experts now expect that 80% of institutional investors will adopt tokenized assets by 2025.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
