Kraken is launching a major innovation that brings together digital assets and traditional stocks. The exchange has announced a new system called xStocks, which will enable 24/7 trading of more than 50 tokenized stocks and ETFs, including financial giants like Apple, Tesla, NVIDIA, and SPDR S&P 500 ETF (SPY).
What is xStocks and How Does It Work?
Kraken’s new product line, branded as “xStocks,” operates on the Solana blockchain. Each xStock token is a 1:1 digital representation of a real stock or ETF. These tokens are supported by Backed Finance, a Swiss-based entity, and are directly collateralized with the corresponding underlying assets. In practice:
- If the real stock is priced at $200, the xStock token will hold the same value.
- Investors will be able to redeem these tokens for cash.
The main advantage of xStocks is their continuous trading feature—they can be traded even when traditional stock markets are closed. This provides significant flexibility for investors across different continents.
Available Everywhere Except the U.S. (For Now)
Kraken will initially launch xStocks in Europe, Asia, Africa, and Latin America. Due to regulatory barriers, U.S. users will not have access to these services for now. However, the company emphasizes that it is in active discussions with global regulatory bodies to ensure compliance in the long term.
With this approach, Kraken aims to overcome the legal challenges faced by similar tokenized stock projects in the past.
24/7 Stock Trading: What Does It Mean?
Kraken’s initiative could change the rules of the game not just for crypto enthusiasts, but also for stock market investors. With xStocks, users can:
- Trade outside of regular market hours,
- Buy and sell without being tied to the traditional exchange system,
- Hold shares like Apple or Tesla directly in their digital wallets.
Thanks to potential integration with DeFi applications, these tokens may also be used as collateral for borrowing or to generate passive income, enabling new financial scenarios.
A New Era in the Global Financial System
Kraken’s tokenized stock initiative further blurs the line between crypto and traditional finance. The partnership with Backed Finance provides confidence by ensuring each token is backed by a real-world asset. The use of Solana blockchain guarantees low transaction fees and high speed.
In the future, xStocks may also support cross-chain compatibility with Ethereum or other networks. This would expand both the accessibility and usability of the product even further.
