The move brings 24/7 trading of equities and ETFs to DeFi’s largest blockchain.
Cryptocurrency exchange Kraken announced on Tuesday, Sept. 2, that it will launch tokenized versions of U.S. stocks on Ethereum mainnet via xStocks, a product developed by Backed.
The expansion allows 24/7 trading of equities such as Apple, Tesla, and Nvidia and exchange-traded funds (ETFs) on Ethereum, the world’s largest blockchain by total value locked (TVL) in DeFi, with nearly $107 billion currently held across Ethereum-based protocols, according to DefiLlama.
As part of the integration, eligible Kraken clients — namely non-U.S. traders — will be able to deposit and withdraw xStocks directly on Ethereum. Backed will issue xStocks as ERC-20 tokens and ensure full 1:1 collateralization for every equity listed on Kraken’s platform, according to a Kraken blog post published today.
Kraken currently offers xStocks to non-U.S. users on Solana, Tron, and BNB Chain, making Ethereum the fourth blockchain network where the assets are deployed.
“Through the expansion of xStocks to Ethereum Mainnet, xStocks tap into the largest pool of on-chain liquidity and connect to the most well-established DeFi protocols in the space,” said Roberto Klein, Backed’s co-founder, in the release. Klein continued: “xStocks are designed for composability. We look forward to working with these teams and developing xStocks to their full potential.”
Kraken is one of the largest U.S.-based centralized exchanges (CEXs) with a recorded $1.5 billion in revenue and $664 billion in trading volume in 2024, according to company documents. In the past 24 hours, Kraken has seen about $1.3 billion in trading volume, behind Coinbase’s $3.2 billion, per data from CoinGecko.
xStocks Figures Are Still Lagging
The expansion comes as xStocks recently announced it had surpassed $500 million in on-chain transaction volume just 49 days after the product’s public launch. While the milestone highlights growing interest in tokenized stocks, some experts told The Defiant that the figure was largely symbolic.
Doug Colkitt, initial contributor to Fogo, explained that while half a billion dollars in under two months is “not trivial,” it doesn’t really hold a candle to other trading venues. “Solana DEXes see that much volume in an afternoon,” he told The Defiant last month.
Indeed, over the past 24 hours, Meteora recorded $932 million in decentralized exchange (DEX) trading volume, followed by Raydium at $637 million, and Orca at $496 million, according to DefiLlama.
However, the figure is impressive for the tokenized equities market, Tom Bruni, editor and VP of Stocktwits, told The Defiant in August. He added that this also “serves as a good proof-of-concept and a green light for those building in the space.”
