The Rise of Tokenized Equities: Kraken's Strategic Move to Dominate Real-World Asset Tokenization

The tokenization of real-world assets (RWAs) has emerged as one of the most transformative forces in modern finance, bridging traditional markets with blockchain innovation. At the forefront of this movement is Kraken, which has made a bold strategic pivot to dominate the tokenized equities space through its acquisition of Backed Finance AG, the creator of xStocks. This move not only accelerates Kraken's vision of programmable capital markets but also positions the exchange to capture a significant share of the projected $2 trillion RWA market by 2028, as forecasted by Standard Chartered.

Strategic Acquisition and Market Leadership

Kraken's acquisition of Backed Finance AG represents a masterstroke in consolidating its leadership in tokenized equities. By integrating xStocks-a platform offering fractionalized ownership of traditional assets like Apple, Nvidia, and Tesla shares-Kraken has created a unified framework for issuance, trading, and settlement according to company announcements. Since its June 2025 launch, xStocks has attracted over 84,000 holders and generated $12 billion in total trading volume, with daily transactions exceeding $30 million. This rapid adoption underscores the growing demand for tokenized assets among both retail and institutional investors, who are drawn to the liquidity, transparency, and programmability these instruments offer.

The acquisition also aligns with Kraken's broader mission to build an open financial system. By expanding xStocks to multiple blockchains-including Solana, Ethereum, and upcoming integrations on TON, Tron, Mantle, and BNB Chain-Kraken is fostering interoperability, a critical factor in scaling tokenized markets. This cross-chain approach ensures that tokenized equities can reach a global audience, reducing friction and enabling seamless capital flows across ecosystems.

Infrastructure Development and Institutional Adoption

For tokenized equities to achieve mainstream adoption, robust infrastructure is essential. Kraken's Q3 2025 financial performance- including $648.0 million in revenue and $178.6 million in adjusted EBITDA-highlights the exchange's capacity to invest in foundational systems. These include custody solutions tailored for institutions, which are critical for securing large-scale assets and building trust in the tokenization model. By offering secure, compliant custody services, Kraken is addressing a key barrier to institutional participation, enabling pension funds, hedge funds, and other entities to allocate capital to tokenized assets without compromising regulatory standards.

Moreover, Kraken's Proof of Reserves audits-a practice it pioneered before becoming an industry standard- further bolster confidence in its infrastructure. These audits verify that all tokenized assets are fully backed by their underlying real-world counterparts, mitigating risks of insolvency or fraud. Such transparency is indispensable for attracting institutional capital, which demands rigorous due diligence before committing to new asset classes.

Regulatory Compliance and Market Participation

Regulatory clarity remains a pivotal challenge in the tokenization space. Kraken's strategic alignment with xStocks' 1:1 asset backing model ensures compliance with existing securities frameworks, reducing legal ambiguity for both issuers and investors. This approach also positions Kraken to navigate evolving regulations, such as the U.S. SEC's ongoing scrutiny of digital assets, by demonstrating a commitment to investor protection and market integrity.

To further incentivize participation, Kraken has launched its Market Participation Program, offering stock warrants to its most active traders. This initiative not only rewards liquidity providers but also aligns user interests with the exchange's long-term growth. As Kraken prepares for an anticipated 2026 IPO according to industry reports, such programs are likely to deepen user engagement and accelerate the tokenization ecosystem's maturation.

The Road Ahead: Scaling a Global Financial System

Kraken's strategic moves are not confined to short-term gains. The company's focus on interoperability, institutional-grade custody, and regulatory compliance lays the groundwork for a future where tokenized equities become a cornerstone of global finance. With xStocks already offering exposure to over 60 tokenized equities and ETFs according to company data, and Kraken's Q3 2025 results demonstrating strong financial health as reported in financial highlights, the exchange is well-positioned to capitalize on the $2 trillion RWA opportunity by 2028 as forecasted by market analysis.

For investors, the implications are clear: Kraken's aggressive expansion into tokenized equities and RWAs represents a high-conviction bet on the future of finance. As institutional adoption accelerates and infrastructure matures, the exchange's ability to unify traditional and blockchain markets could redefine capital allocation for decades to come.