Nasdaq teams up with Kraken to expand tokenization infrastructure

• Nasdaq previously sought SEC approval in September to allow trading in 'traditional digital or tokenized form' of securities
• Competitors including NYSE parent ICE, Robinhood, Gemini, and Coinbase are pursuing similar tokenization platforms, with some already operational in Europe
• The partnership will focus on enabling corporate actions, proxy voting, and 24/7 trading through blockchain-based settlement systems

Nasdaq Partners with Kraken to Develop Tokenization Infrastructure

Nasdaq announced Monday a collaboration with Payward, Kraken's parent company, to build tokenization infrastructure for blockchain-based equities. The partnership aims to capitalize on growing institutional interest in converting traditional financial assets into tradable crypto assets on blockchain networks.

Key Details:

Under the agreement, Nasdaq will utilize Payward's xStocks tokenization platform to enable clients to transfer securities from institutional trading systems to blockchain networks. The initiative will focus on corporate actions, proxy voting, and exchange-traded products.

Market Context:

Tokenization—converting assets like stocks, bonds, funds, and real estate into blockchain-based crypto assets—has gained momentum following the passage of the GENIUS Act. In September, Nasdaq sought SEC approval for trading securities in "traditional digital or tokenized form."

Competition in this space is intensifying. NYSE parent Intercontinental Exchange (ICE) sought regulatory approval in January for a 24/7 trading platform for tokenized securities with on-chain settlement. Robinhood, Gemini, and Kraken have already launched tokenized stocks in Europe, while Coinbase and startup Dinari are pursuing U.S. approval for similar products.

Market Implications:

Nasdaq cited tokenization's potential to create an "always-on financial ecosystem," improving market access for investors and issuer engagement. However, investor sentiment on cryptocurrencies remains divided, with bitcoin trading near pre-2024 election levels despite President Trump's victory.

The collaboration signals major traditional exchanges are positioning themselves for blockchain-based trading infrastructure, though regulatory approval and market adoption remain critical factors. Increased competition among exchanges and crypto platforms suggests tokenization is becoming a strategic priority for financial market infrastructure providers.