The effort is designed to offer new opportunities to integrate tokenized stocks and exchange-traded funds (ETFs) “across the world’s most widely adopted smart contract network,” according to a Tuesday (Sept. 2) Kraken blog post.
“Ethereum’s vibrant developer community, deep liquidity and global user base make it a natural home for the next phase of xStocks’ expansion,” the post said. “By extending Kraken’s support of xStocks to Ethereum, we’re enabling millions of Ethereum users and thousands of live applications to source the industry standard for tokenized equities liquidity.”
In the weeks ahead, eligible Kraken clients will be permitted to deposit and withdraw xStocks directly on Ethereum, which offers investors greater choice and flexibility to transfer assets between Kraken and self-custodial wallets for on-chain activity, per the post.
Kraken announced in late June that it started offering tokenized U.S. stocks and ETFs on its platform for eligible non-U.S. clients, thanks to xStocks.
Kraken co-CEO Arjun Sethi said in the blog post that xStocks is a key component in Kraken’s efforts to bring traditional assets “onto trust-minimized infrastructure” while integrating public markets with the internet’s base layer.
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“Our multi-chain strategy is deliberate,” he said in the post. “It ensures tokenized equities are accessible across ecosystems, portable between wallets and protocols, and composable within the applications users already trust. Ethereum is the next logical step. It is the center of gravity for smart contract innovation, on-chain liquidity and decentralized finance. By launching xStocks on Ethereum, we are making tokenized equities programmable, interoperable and continuously accessible to builders and institutions worldwide.”
PYMNTS explored the world of tokenized stocks earlier this summer following Kraken’s initial launch of xStocks and Robinhood’s tokenized stock announcement. Soon after, the news broke that JPMorgan Chase was developing a new service to tokenize carbon credits.
“While the initiatives may appear distinct, ranging from environmental credits to fractionalized equity exposure, the connective tissue is the same,” PYMNTS wrote July 3. “Moving traditional financial services onto the blockchain.”
