Preface

In a significant move by Kraken, the exchange is set to list tokenized versions of major US companies such as Nvidia, Apple, and Tesla. This not only expands Kraken's offerings but also marks a pivotal moment in the integration of traditional and digital finance. With the increasing trend of tokenization, Kraken steps into new territories, aiming to cater to a wider global audience.

Lazy bag

Kraken will list tokenized shares of over 50 major U.S. companies, paving the way for increased access to tokenized markets.

Main Body

Kraken seems poised to make a bold stride in the world of finance by launching tokenized shares of some of the largest companies in the U.S. These shares, encompassing recognizable names such as Nvidia, Apple, and Tesla, along with more than 50 other U.S. stocks and exchange-traded funds (ETFs), are planned for listing as reported by the Wall Street Journal. These tokens are to be deployed on the Solana blockchain, linking the traditional financial assets with the digital asset market.

The mechanism behind these offerings involves the stocks being represented by actual shares held by Backed Finance, with the facility to redeem them 1:1 for their cash value. Initially, in April, Kraken had declared a rollout of over 11,000 U.S.-listed stocks and ETFs, which started in 10 U.S. states via Kraken Securities. This latest development seeks to extend Kraken’s offerings to include tokenized versions of stocks and ETFs for global clientele, targeting new regions including Europe, Latin America, Africa, and Asia.

This expansion places Kraken in direct competition with platforms such as Robinhood, and distinguishes it as the first exchange to offer tokenized shares of major U.S. companies successfully. Notably, Binance’s attempt to offer similar services was short-lived due to regulatory hurdles in 2021. Kraken's spokesperson confirmed their efforts with various regulatory bodies to secure legal offerings of xStocks across different jurisdictions, taking into account the varying regulatory landscapes.

The concept of tokenization, effectively transforming real-world assets into blockchain-based tokens, is rapidly gaining traction in the crypto landscape. More companies have started to explore this space, attributing to its growth. Notable entities like Ondo Finance, BlackRock, and Franklin Templeton have been pioneers in this area, collectively contributing to a burgeoning tokenization market, which hit a substantial $65 billion in market capitalization by May.

Helene, a New York-based markets reporter at CoinDesk, covers such groundbreaking developments from Wall Street and the crypto markets. With credentials from New York University's business and economic reporting program, her insights have been featured in mainstream outlets like CBS News, YahooFinance, and Nasdaq TradeTalks, where she lends her expertise and personal experience as a holder of BTC and ETH.

Key Insights Table