Cryptocurrency exchange Kraken has made a bold move into traditional finance by launching tokenized stock trading. This new service will let customers buy digital tokens that track the value of popular stocks like Apple, Tesla, and Nvidia. It’s like getting a piece of these big companies but in a digital form that lives on the blockchain.
The idea is pretty simple. Instead of buying actual shares through a regular stock broker, you can now buy tokens on Kraken that match the price of real stocks. When Apple’s stock goes up, your token value goes up too. These tokens work 24/7, unlike regular stock markets that close every day.
Jesse Powell, Kraken’s co-founder, explained that this move helps bridge the gap between crypto and traditional finance. “We’re bringing Wall Street to the blockchain,” Powell said in a recent announcement. The company spent months making sure everything follows the rules before launching.
Kraken isn’t the first crypto company to try this. Other exchanges like Binance and FTX offered similar services before. But FTX collapsed in 2022, and Binance faced trouble with regulators. Kraken believes they’ve learned from these situations and built their service to better follow regulations.
For regular people, this means more ways to invest. You don’t need a traditional brokerage account anymore. You can use your crypto wallet to buy pieces of famous companies. And you might be able to trade at times when the regular stock market is closed.
The tokens are backed by actual shares held by Kraken’s partners. This means each token represents real ownership in these companies, just in a different form. Kraken has worked with financial experts to make sure everything is secure and transparent.
Some financial watchdogs have concerns about these kinds of products. They worry that people might not understand the risks or how these tokens differ from regular stocks. The U.S. Securities and Exchange Commission (SEC) has been looking closely at crypto companies offering investment products.
Trading these stock tokens comes with some different rules than trading actual stocks. You’ll need to complete identity checks, and there might be limits on how much you can buy or sell. Kraken says this helps keep everything safe and legal.
The launch is happening first in certain countries outside the United States. Kraken plans to expand to more places as regulations become clearer. The company believes tokenized stocks could eventually become a major part of how people invest around the world.
For the crypto industry, this represents another step toward mainstream acceptance. By connecting digital assets to traditional companies that people know and trust, Kraken hopes to bring in customers who might have been hesitant about crypto before.
Financial experts have mixed opinions about tokenized stocks. Some see them as an innovative way to make markets more accessible. Others worry they might create confusion or new kinds of risks. “The technology is promising, but investors should understand what they’re buying,” said Maria Chen, a financial technology researcher at Capital Market Insights.
Kraken’s move comes as more traditional financial companies are exploring blockchain technology themselves. Major banks and investment firms have been testing ways to use digital tokens for various financial services.
For now, interested investors should research carefully before jumping in. Understanding the differences between tokenized stocks and regular shares is important. While they track the same values, they work differently behind the scenes and might have different legal protections.
The future of finance might include more of these hybrid products that combine traditional investments with new technology. As the lines between crypto and mainstream finance continue to blur, services like Kraken’s tokenized stocks could become just another normal way to invest.
