The global financial industry is facing a new frontier: tokenized stock trading. As blockchain technology reshapes how assets are issued, traded, and managed, major exchanges like Kraken are pressing for regulatory clarity. Kraken recently met with the U.S. Securities and Exchange Commission (SEC) Crypto Task Force to pitch its plan for a 24/7 tokenized trading system, raising both optimism and skepticism within the financial community.
While proponents argue tokenization could democratize market access and unlock a trillion-dollar opportunity, regulators and traditional exchanges warn of potential investor protection risks and threats to market integrity. This article breaks down Kraken’s initiative, the regulatory landscape, global industry pushback, and what this means for investors and fintech platforms alike.
According to SEC filings, Kraken executives, alongside counsel from Wilmer Cutler Pickering Hale and Dorr, outlined their vision for a tokenized securities platform. Their agenda focused on:
Technical infrastructure: Leveraging blockchain for continuous, borderless trading of traditional equities.
Regulatory frameworks: Seeking guidance on how tokenized products can operate under U.S. securities laws.
Market innovation: Positioning tokenization as a way to enhance capital formation and expand access to retail and institutional investors.
Kraken’s timing is notable. In May, it launched tokenized U.S. stock trading for international clients, providing 24/7 access to American equities. By expanding onto multiple blockchains, including Ethereum and Tron, Kraken aims to establish itself as a leader in this evolving space.
Despite growing enthusiasm, traditional exchanges and regulators remain cautious. The World Federation of Exchanges and other industry associations have urged the SEC to scrutinize tokenized stock offerings, citing concerns such as:
Lack of investor safeguards compared to regulated markets.
Disruption of market structure due to round-the-clock trading.
Unclear oversight mechanisms for preventing manipulation and fraud.
Currently, the tokenized stock market is relatively small—about $360 million in circulation, only 1.35% of the broader $26.5 billion tokenized real-world asset (RWA) market, according to RWA.xyz. However, forecasts suggest explosive potential. Binance Research estimates tokenized equities could exceed $1.3 trillion if just 1% of global stock markets move to blockchain platforms.
From a policy perspective, the SEC faces a balancing act: promoting financial innovation while ensuring compliance with the Securities Act of 1933 and the Securities Exchange Act of 1934, both of which mandate transparency and investor protection.
Despite U.S. regulatory uncertainty, Kraken and competitors are pressing forward internationally.
Kraken: Expanded tokenized offerings to the Tron blockchain, increasing accessibility.
Robinhood: Launched tokenized stock trading for European Union clients in June.
Investor sentiment: A Kraken survey found that 65% of U.S. investors who trade both equities and crypto believe digital assets will outperform stocks over the next decade.
These moves highlight the growing appetite among global investors for programmable, borderless, and always-available financial products. However, regulatory clarity will determine whether tokenization becomes mainstream or remains a niche product.
As blockchain-based assets gain traction, secure payment and compliance tools become essential. Tokenized stock platforms often require investors to bridge traditional banking with digital finance—here, virtual card solutions play a vital role.
This is where platforms like Buvei come in. Buvei provides API-first virtual card solutions designed for fintech companies, trading platforms, and global teams. With features such as:
KYC/AML compliance support, aligning with evolving global regulations.
Instant issuance and programmable controls for managing tokenized transactions.
Cross-border payment flexibility, enabling seamless integration with digital asset platforms.
In a landscape where regulatory scrutiny is intensifying, solutions like Buvei help exchanges and investors navigate compliance while ensuring secure and efficient operations.
Kraken’s push for SEC approval marks a pivotal moment in the future of tokenized finance. While the potential market is enormous, regulators remain cautious, balancing innovation with investor protection. The outcome of these discussions could determine whether 24/7 tokenized stock trading becomes a regulated norm or faces stricter limitations.
For investors and fintech platforms, this highlights the need to prepare for a future where traditional assets and blockchain converge. As global adoption accelerates, tools like Buvei’s virtual card solutions will become increasingly important in bridging compliance, security, and innovation.
The race toward tokenized capital markets is on, but regulatory clarity will decide the winners.
