Nasdaq has agreed to invest $100 million in Payward, the parent company of cryptocurrency exchange Kraken, through its venture arm. The investment values Payward at $21 billion and deepens an existing partnership between the two firms.
The expanded partnership aims to build, distribute, and trade tokenized stocks, with a target launch date in the second quarter of 2027. Kraken's xStocks product will power a permissionless blockchain layer for Nasdaq's issuer-sponsored equity tokens.
As part of the deal, Payward will adopt Nasdaq's market surveillance technology across its crypto, equities, tokenized equities, futures, and options venues.
Expanding Beyond Cryptocurrency
Kraken is expanding its offerings beyond cryptocurrency trading. In April, the exchange began offering more than 11,000 US stocks and ETFs through its FINRA-regulated brokerage. The xStocks tokenized-equity product runs on public blockchains including Ethereum and Solana.
This move represents Kraken's entry into stocks, derivatives, and other traditional financial products.
Settlement Efficiency
According to Payward Co-CEO Arjun Sethi, more than $2 trillion of stock trades flow through the U.S. clearing system daily. Trades net down by approximately 98 percent, and the clearing house holds $10 billion to $20 billion in collateral while awaiting settlement. Reducing settlement time from two days to one in 2024 released $3 billion in collateral. Onchain settlement would eliminate the waiting period entirely.
Building Market Infrastructure
Within Nasdaq, the work is led by its Digital Liquidity Networks unit, which builds market infrastructure. The partnership "advances our work on Nasdaq Equity Tokens and helps build a more connected financial system while preserving the trust, transparency and integrity that underpin capital formation," said Tal Cohen, President of Nasdaq.
Nasdaq introduced its equity-token framework earlier this year, designed to preserve issuer control and shareholder rights. The next phase will develop global distribution, trading, and post-trade capabilities for these tokens.
This investment follows Deutsche Börse's $200 million stake in Payward in April, which valued the firm at $13.3 billion at that time.
