Cryptocurrency exchange Kraken has successfully broadened its xStocks offering, granting millions of clients within the European Union direct on-chain access to U.S. equities. This new initiative enables eligible investors in the region to trade tokenized representations of popular U.S. stocks and exchange-traded funds (ETFs) via the Kraken app.
Mark Greenberg, Kraken’s global head of consumer, highlighted the significance of this expansion, stating, “Expanding xStocks to the European Union was a natural next step for Kraken, given our dedicated growth strategy and market presence here. For too long, it’s been unnecessarily challenging to gain exposure to U.S. markets, and with xStocks we’re removing many of the barriers.”
The tokenized stocks, referred to as xStocks, were developed in collaboration with the Swiss fintech firm Backed. These blockchain-based tokens mirror the value of their underlying U.S. stocks or ETFs, allowing for seamless trading and holding akin to regular cryptocurrencies within users’ digital wallets. This innovation is set to tackle the persistent challenges faced by global investors aiming to access the U.S. stock market, a process that has historically been cumbersome and fraught with obstacles.
Through xStocks, European investors can trade tokenized certificates that track the real-time prices of leading U.S. equities, eliminating reliance on traditional brokerages or intermediaries. This system also ensures that investors retain complete control over their assets, facilitating easy transfers across compatible platforms while allowing for self-custody.
Additionally, xStocks can be integrated with decentralized finance (DeFi) protocols, serving as versatile financial instruments that enhance user flexibility and engagement in the evolving digital marketplace.
Kraken’s introduction of 24/5 xStocks trading within the EU aligns with the rising interest in blockchain-based financial infrastructure, mirroring broader industry trends that emphasize decentralization, transparency, and the democratization of financial markets. Research from Boston Consulting Group and McKinsey & Company suggests that the global tokenized asset market could reach monumental values, potentially worth trillions of dollars by the 2030s.
The tokenized stocks operate as SPL tokens on the Solana blockchain, which is known for its rapid and cost-effective transaction capabilities. Plans are in motion to extend support to BEP-20 blockchains and Ethereum’s mainnet for a more robust multi-chain presence. This strategic approach aims to deepen the integration of xStocks within the burgeoning DeFi ecosystem, further advancing Kraken’s mission in the digital finance space.
