🕒 Posted on: 12/2/2025 9:31:53 PM UTC

Kraken Acquires Backed Finance, Takes Full Control of Tokenized-Equity Platform xStocks

Kraken's acquisition of Backed Finance AG marks a pivotal consolidation in the tokenized securities market, bringing the prominent xStocks platform fully under the exchange's control as it expands its real-world asset (RWA) offerings.

Introduction: A Strategic Move in the Tokenization Race

In a significant move that underscores the accelerating convergence of traditional finance and digital assets, U.S.-based cryptocurrency exchange Kraken has agreed to acquire Backed Finance AG. This acquisition grants Kraken full ownership of xStocks, a leading platform for issuing tokenized versions of publicly traded equities and exchange-traded funds (ETFs). The deal, announced in late 2024, represents a strategic consolidation for Kraken, which had already begun rolling out Backed’s products to its European user base earlier in the year. By bringing the issuance, trading, and settlement infrastructure in-house, Kraken aims to deepen its integration of tokenized equities across its product suite, including its global money app, and expand support to additional blockchains and markets. This acquisition is the latest in a series for Kraken in 2024, following purchases of NinjaTrader, Breakout, and Small Exchange, and occurs against the backdrop of the exchange's confidential U.S. IPO filing submitted in November.

The Acquisition: Terms, Timing, and Strategic Rationale

The companies did not disclose the financial terms of the deal. The acquisition follows Kraken’s initial integration of Backed’s xStocks product for eligible European users in September 2024, suggesting a phased partnership that has now evolved into full ownership.

Strategically, the acquisition allows Kraken to directly control a key piece of infrastructure in the burgeoning tokenized securities ecosystem. By owning the issuer (Backed Finance AG) and the primary distribution and trading venue (its own exchange), Kraken can streamline operations, enhance product development, and create a more seamless user experience. The announcement stated that Kraken plans to integrate xStocks’ issuance, trading, and settlement more tightly into its products. Furthermore, Kraken intends to consolidate the xStocks Alliance—a network of partnered chains and trading venues it operates—to support broader interoperability and liquidity as more markets adopt tokenized equities.

This move is consistent with Kraken’s aggressive expansion strategy in 2024. Prior acquisitions targeted different segments of the trading landscape: NinjaTrader (a futures trading platform) in May, Breakout (a proprietary trading platform) in September, and Small Exchange (a designated contract market) in October. Acquiring Backed Finance represents a direct investment into the asset issuance layer itself, specifically for real-world assets (RWAs), complementing its existing trading venue strengths.

Understanding xStocks: A Leading Tokenized Equities Platform

xStocks is a platform that issues tokenized versions of publicly traded equities, such as stocks and ETFs. These digital tokens represent ownership of the underlying traditional securities on a blockchain. According to the provided information, xStocks currently offers over 60 tokenized products and has recorded more than $10 billion in combined exchange and on-chain volume since launching earlier in 2024.

The technical infrastructure of xStocks allows these tokenized assets to be live on both the Solana and Ethereum blockchains. Trading is available 24/7 on-chain, contrasting with the traditional market hours of stock exchanges. A key feature highlighted by the platform is that these assets can be self-custodied—held in a user’s personal wallet—and used across multiple networks.

The platform gained notable traction in June 2024 when it launched on several major venues, including Bybit, Kraken, and various Solana-based decentralized finance (DeFi) platforms. Its initial lineup featured tokenized versions of prominent blue-chip stocks like Netflix, Meta, Coinbase, Amazon, Nvidia, McDonald’s, Apple, Tesla, and Microsoft.

The Broader Landscape: Tokenized Equities Gain Traction

Kraken’s acquisition is not an isolated event but part of a major trend within the crypto industry for 2024: the rise of tokenized equities. These digital representations of traditional stocks have become one of the year’s most prominent trends as platforms seek to bridge TradFi and DeFi.

Robinhood’s Parallel Move: In the same month xStocks expanded its listings (June 2024), global trading platform Robinhood launched its own layer-2 blockchain on Arbitrum and rolled out tokenized stock trading for European Union users. Robinhood debuted with a significantly larger offering of more than 200 US stock and ETF tokens, tradeable 24/5 with no commission. Data from Dune Analytics shows Robinhood has since listed 943 tokenized stocks and ETFs on Arbitrum, with a total on-chain value of approximately $10.8 million.

Market Share Among Regulated Issuers: Data from RWA.xyz provides a snapshot of the competitive landscape for regulated tokenized public stock issuers. The total market is tracked at roughly $656 million, with $1.14 billion in monthly transfer volume across about 118,000 holders. Within this regulated segment:

Ondo Finance leads with about 52% of the market.
Backed Finance (now owned by Kraken) holds approximately 24%.
Securitize follows with around 20%.

This data contextualizes Backed’s position as a significant #2 player in the regulated issuance space prior to its acquisition by Kraken.

Comparative Analysis: xStocks vs. Robinhood's Tokenized Offering

While both Kraken (via xStocks) and Robinhood are major players pushing tokenized equities, their approaches and current scales show distinct differences:

Issuance & Model: xStocks is primarily an issuance platform (Backed Finance AG) whose tokens are then listed on various exchanges like Kraken and Bybit. Robinhood appears to be integrating issuance and trading within its own vertically integrated platform for EU users.
Scale of Offerings: As per the latest data provided, Robinhood’s offering is quantitatively larger, with 943 tokenized products listed compared to xStocks’ “over 60.” However, xStocks boasts a higher reported cumulative volume of “more than $10 billion” since launch.
Blockchain Infrastructure: xStocks assets are live on Solana and Ethereum. Robinhood has chosen to build its own layer-2 blockchain on Arbitrum for its tokenized stock offerings.
Target Market & Accessibility: Both initially targeted European users due to regulatory frameworks. xStocks products were rolled out to eligible European users on Kraken first. Similarly, Robinhood launched its tokenized stock trading specifically for European Union users.

The key takeaway is that while Robinhood currently lists more tokens, Backed/xStocks held a strong market share position among regulated issuers and brought established multi-chain infrastructure and significant trading volume to Kraken’s acquisition table.

Historical Context: Kraken's Acquisition Spree and Path to IPO

This acquisition fits into a clear pattern of strategic growth by Kraken throughout 2024:

May 2024: Acquisition of NinjaTrader Group.
September 2024: Acquisition of proprietary trading platform Breakout.
September 2024: Rollout of Backed’s xStocks to European users.
October 2024: Acquisition of Small Exchange.
November 2024: Confidential U.S. IPO filing submitted to regulators.
Late 2024: Acquisition of Backed Finance AG.

This sequence reveals a strategy focused on vertical integration (acquiring an issuer like Backed) and horizontal expansion (acquiring different types of trading platforms). The confidential IPO filing suggests these acquisitions are partly aimed at building a more comprehensive and robust financial services portfolio to present to public market investors.

Conclusion: Consolidation and Integration Define the Next Phase

Kraken’s full acquisition of Backed Finance AG represents a decisive step in the maturation of the tokenized securities market. It moves beyond simple partnerships to deep integration, where a major exchange now controls a top-tier issuance platform for real-world assets.

The immediate impact is the consolidation of the xStocks Alliance network under one corporate umbrella, which Kraken states will enhance interoperability and liquidity for tokenized equities. For users, this likely means a more integrated experience within Kraken’s ecosystem, potential expansion to new blockchains beyond Ethereum and Solana, and access to a wider range of tokenized products over time.

Broader Market Insight: This deal highlights two dominant themes for crypto-native institutions: vertical integration and the strategic pursuit of Real-World Asset (RWA) offerings. As regulatory clarity slowly emerges in key markets like Europe and potentially Hong Kong or Singapore—while remaining challenging in the U.S.—exchanges are positioning themselves to be gateways not just for cryptocurrencies but for a digitized version of all financial assets.

What Readers Should Watch Next:

Kraken’s Integration Pace: How quickly will Kraken integrate xStocks deeper into its main exchange and global money app? Announcements regarding new blockchain support or geographic market expansions will be key indicators.
Competitive Responses: How will other major exchanges like Coinbase or Binance respond? Will they seek similar acquisitions or develop competing in-house issuance platforms?
Regulatory Developments: The growth of regulated issuers like Backed depends heavily on jurisdictional approvals. Monitoring regulatory announcements in Europe regarding crypto-asset laws (MiCA) will be crucial.
The IPO Journey: Progress on Kraken’s confidential IPO filing will be a significant bellwether for how traditional public markets value crypto exchanges expanding into TradFi asset tokenization.

The acquisition solidifies Kraken’s commitment to being a full-spectrum digital asset hub. By bringing tokenized equity issuance in-house during a year marked by aggressive expansion and an IPO filing, Kraken is signaling that the future of finance is not just digital but interconnected—and it intends to own critical parts of that infrastructure