Nasdaq and Kraken Launch Equity Token Gateway to Boost Market Liquidity

Nasdaq has announced a partnership with Payward, the parent company of cryptocurrency exchange Kraken, to develop a gateway for tokenized equities. 

The system will allow tokenized stocks to move between traditional financial markets and blockchain networks.

The initiative aims to place public companies at the center of ownership rights, investor experience, transparency, and governance. 

Nasdaq will facilitate the tokenization of equities, giving issuers greater control over how their shares are represented and transferred in digital form.

Nasdaq–Kraken Gateway to Enable Tokenized Stocks

The equity token gateway is designed to bridge traditional securities markets with blockchain-based trading platforms.

Under the plan, one-to-one tokenized versions of public company shares will be offered to Kraken customers outside the United States. 

The service is expected to target investors in Europe and other international markets.

Token holders will maintain the same rights as traditional shareholders. These rights include voting power and dividend entitlements.

The system does not create synthetic or derivative products. Instead, token transfers represent transfers of the underlying equity security. 

Blockchain records will also be integrated into the issuer’s official share registry.

How Tokenized Equities Work on Blockchain

Tokenization converts ownership of a financial asset such as a publicly traded stock into a digital token recorded on a blockchain network.

Traditional equity trading relies on brokers, clearinghouses, and custodians. Settlement can take several days.

Blockchain infrastructure records transactions on a distributed ledger. Ownership transfers can occur almost instantly.

Traditional Trading	Tokenized Trading
Shares traded through brokers and clearinghouses	Shares represented as blockchain-based tokens
Multi-day settlement via DTCC	Near-instant settlement on-chain
Whole share ownership only	Fractional share ownership possible
Standard exchange hours	Potential for extended or 24/7 trading
Domestic market access	Global investor participation

The Nasdaq–Kraken system builds on the adoption of xStocks, tokenized exposure products for publicly traded equities across blockchain ecosystems.

Since launching less than a year ago, xStocks have generated more than $25 billion in total transaction volume, including $4 billion settled on-chain. The products now have over 85,000 unique holders across supported networks.

Nasdaq has already tested distributed ledger technology for post-trade services. Kraken operates one of the largest global cryptocurrency trading platforms. 

Together, the companies aim to expand the reach of tokenized equities.

Arjun Sethi, co-CEO of Payward and Kraken, said tokenization could modernize financial market infrastructure.

“Tokenization improves market infrastructure at the asset layer,” Sethi said. “It enables equities to exist as interoperable instruments across regulated financial systems and open blockchain networks while preserving issuer rights and price integrity.”

Liquidity and Global Access for Investors

The gateway aims to connect cryptocurrency capital with traditional equity markets. That connection could increase liquidity and broaden investor access.

Key benefits include:

• Fractional share ownership
  
• Access for international investors
  
• Extended or continuous trading hours
  
• Faster settlement and reduced counterparty risk
  
• Direct issuer oversight through integrated registries
  

These features may attract both crypto-native traders and traditional investors seeking greater market flexibility.

Regulatory Structure for Tokenized Securities

Tokenized equities must still comply with existing securities laws.

Nasdaq filed a tokenization proposal with the U.S. Securities and Exchange Commission (SEC) in September 2025. 

The proposal outlines a system where equity securities trade on Nasdaq markets but settle in tokenized form through the Depository Trust & Clearing Corporation (DTCC).

The initiative also aligns with the SEC’s 2026 Staff Statement on Tokenized Securities, which confirms that tokenized equities fall under the same legal framework as traditional shares.

Investor protections, disclosure rules, and anti-money-laundering requirements remain in place.

Payward Services will manage onboarding for tokenized equities on Kraken. The platform will conduct Know Your Customer (KYC) and Anti-Money Laundering (AML) checks to ensure regulatory compliance.

Timeline and Industry Context

Nasdaq expects the tokenized equity gateway to become operational in the first half of 2027.

The exchange also announced a separate partnership with Boerse Stuttgart Group’s tokenized settlement platform, Seturion, connecting European trading venues with infrastructure designed for tokenized settlement.

The Nasdaq–Kraken collaboration reflects a broader trend across global finance. Banks, exchanges, and asset managers are exploring tokenization for equities, bonds, and investment funds.

Consulting firm Boston Consulting Group estimates tokenized assets could reach trillions of dollars in value over the next decade if adoption continues to grow.

Conclusion

The Nasdaq–Kraken equity token gateway represents a significant step toward integrating blockchain technology with traditional financial markets.

By tokenizing publicly listed shares and connecting them to Kraken’s global trading platform, the initiative could expand liquidity, broaden investor access, and modernize settlement infrastructure.

If adoption accelerates, tokenized securities may become a major component of future capital markets.