Ethereum News Today: "Tokenized Stocks Enter Ethereum Era, Reshaping Access and Regulation"

xStocks, a tokenized equity product developed by Backed Finance, has officially launched on the Ethereum blockchain with approximately 60 tokenized stocks, including major names such as NVIDIA, Amazon, Tesla, Meta, and Walmart. The product is now available on Ethereum as ERC-20 tokens, fully collateralized 1:1 by underlying equities. This move follows the product’s earlier launches on Solana, BNB Chain, and Tron, and brings the total trading volume of xStocks across these chains to over $3.5 billion [2]. Kraken, in partnership with Backed Finance, will allow eligible clients to deposit and withdraw xStocks directly on Ethereum, giving investors the ability to transfer assets between the Kraken platform and self-custodial wallets for on-chain activity [1].

The launch of xStocks on Ethereum aligns with the broader trend of tokenizing real-world assets and integrating traditional financial instruments into decentralized finance (DeFi) ecosystems. Ethereum, which holds a 60% share of total value locked (TVL) in the DeFi space, is considered a strategic platform for this initiative [1]. Kraken co-CEO Arjun Sethi emphasized that Ethereum is a natural choice due to its large developer community, deep liquidity, and global user base. The integration of xStocks into Ethereum’s ecosystem also enables interoperability with existing decentralized applications (dApps), wallets, and protocols, further expanding the use cases for tokenized equities [3].

Despite the growing adoption of tokenized stocks, the product remains in a legal gray area. Legal experts have pointed out that tokenized equities may not provide the same legal protections as traditional stock ownership, including voting rights or direct claims on company assets. Additionally, global regulators and stock exchanges have expressed concerns over the lack of standardized oversight, particularly from the U.S. Securities and Exchange Commission (SEC) and other financial watchdogs. While proponents argue that tokenized stocks democratize access to equities by removing traditional barriers, the regulatory landscape remains fragmented and evolving [1].

The tokenized stock market has seen steady growth, with the total market capitalization of tokenized real-world assets (RWAs) reaching $27.9 billion. Tokenized stocks account for 1.2% of this, with a market cap of $342 million [1]. The expansion of xStocks across multiple blockchains highlights the increasing interest in this asset class. Other platforms, such as Gemini and Robinhood, have also launched or explored tokenized stock offerings in recent months, signaling a broader shift in how financial assets are being accessed and traded.

Looking ahead, Backed and Kraken plan to continue integrating xStocks into the Ethereum ecosystem and other blockchain platforms. The partnership aims to make tokenized equities programmable and interoperable across ecosystems, enabling greater flexibility for investors. As the market matures and regulatory clarity improves, tokenized stocks could play a more prominent role in global finance, particularly in facilitating cross-border transactions and improving market accessibility [3].

Source:

[1] Tokenized Equity Product xStocks Launches on Ethereum (https://cointelegraph.com/news/xstocks-launches-ethereum-60-tokenized-stocks-nvidia-tesla)

[2] Kraken, Backed Bring Tokenized Equities Offering to Ethereum Mainnet (https://www.coindesk.com/business/2025/09/02/kraken-backed-bring-tokenized-equities-offering-to-ethereum-mainnet)

[3] xStocks launch on Ethereum (https://blog.kraken.com/product/xstocks/launch-on-ethereum)