Nasdaq collaborates with Kraken to develop tokenized stocks and ETP plans

Techub News reported, according to The Wall Street Journal, that Nasdaq announced a collaboration with crypto exchange Kraken and related issuing companies to develop plans for offering tokenized stocks and exchange-traded products (ETPs) on its exchange. The framework is expected to launch in early 2027, utilizing blockchain technology to streamline corporate governance processes, including automating proxy voting and dividend payments, and ensuring token holders enjoy the same governance rights as holders of the underlying securities. Kraken will serve as a distribution partner, offering its European and global customers tokenized versions pegged 1:1 to publicly traded company stocks; Nasdaq President Tal Cohen stated that this move aims to address previous issues with tokenized products such as tracking errors and lack of governance rights, enhancing market efficiency through modern post-trade infrastructure. Nasdaq is currently awaiting final approval from the U.S. Securities and Exchange Commission (SEC) to allow investors to trade tokenized versions of highly liquid stocks like Nvidia or Tesla on its platform, with tokens and traditional shares sharing a CUSIP number for seamless interchangeability. Following the passage of the stablecoin bill, the "Genius Act," in the U.S. last year, traditional financial giants like the New York Stock Exchange, BlackRock, and JPMorgan have accelerated their foray into the tokenization space.