What happened?
Crypto exchange Kraken has introduced a new product called xStocks, which are tokenized securities that mirror the market prices of real-world U.S. stocks and ETFs. This offering, available via Kraken’s PEDSL-CY entity, is aimed at providing European investors easier access to popular stocks and ETFs from around the globe. By doing so, Kraken is taking a significant step in converging traditional markets with blockchain-based innovations.
Who does this affect?
The launch of xStocks primarily affects EU-based clients of Kraken who have passed an appropriateness assessment or who qualify as professional investors. These clients now have access to 60 assets through xStocks, including 55 stocks and 5 ETFs, with high-profile listings like Tesla, Apple, and GameStop. However, it’s important to note that these xStocks, as they are not registered under the U.S. Securities Act, aren’t available for sale to or possession by U.S. persons.
Why does this matter?
This move adds significant momentum to the growing trend of real-world asset (RWA) tokenization, aiming to modernize markets by merging the stability of traditional assets with the efficiency and transparency of blockchain technology. The introduction of xStocks could potentially transform how global investors engage with both equities and digital finance as these tokenized securities gain traction. Furthermore, with features like 24/7 trading capabilities and fractional investments, Kraken’s xStocks may make investment more accessible to a broader pool of retail investors.