The well-known American cryptocurrency exchange Kraken recently announced the launch of a tokenized stock trading service called "xStocks" on the Solana blockchain, covering more than 50 popular U.S. stocks and ETFs including Apple, Tesla, and Nvidia. This move signifies a deep integration of traditional finance and blockchain technology, potentially reshaping the trading methods of global investors.
What is xStocks?
xStocks is a tokenized stock product jointly launched by Kraken and its partner Backed Finance. Each xStock token represents one share of a real U.S. stock or ETF, held by Backed Finance and can be exchanged 1:1 for cash. These tokens will be issued on the Solana blockchain, supporting 24/7 uninterrupted trading, addressing the issue of limited trading hours in traditional stock markets. Crypto Briefing+3 CoinDesk+3 Yahoo Finance+3
Advantages of xStocks
Global 24/7 trading: Investors are not limited to the trading hours of the U.S. stock market, allowing them to trade even when the market is closed.
Lowering trading barriers: Non-U.S. investors can easily access U.S. stocks through xStocks, avoiding the high fees and complex processes of traditional brokers.
On-chain free transfer: Investors can store xStocks in their personal digital wallets, freely transfer them or use them in DeFi applications, such as staking and lending.
Real-time price tracking: Since each token is backed by a real stock, its price will closely track the market price of the corresponding stock.
Potential Challenges
Despite the many innovations brought by xStocks, it also faces regulatory challenges. Previously, Binance attempted to launch a similar product but was forced to discontinue it due to lack of necessary permissions. Kraken states that it is actively cooperating with regulatory authorities around the world to ensure the legality and compliance of xStocks. PYMNTS.com
Conclusion
Kraken's xStocks project represents a new direction in the development of financial technology, introducing traditional stock trading into the blockchain world, providing global investors with a more convenient and efficient trading method. As technology continues to advance and regulatory frameworks are perfected, tokenized stocks are expected to become a mainstream investment tool in the future.
