Nasdaq’s $100M Investment in Payward Values Kraken’s Parent at $21 Billion

Nasdaq is putting real money behind its bet on tokenized stocks, and the recipient is a crypto exchange most regulators once treated with suspicion. The exchange operator’s venture arm has agreed to invest $100 million in Payward, the parent company of Kraken, according to Bloomberg, which reported the figure ahead of the official announcement, citing people familiar with the matter. The Nasdaq investment in Payward extends a tokenized-equities partnership the two firms first struck in March, and it comes bundled with a separate deal that puts Nasdaq’s market surveillance technology inside Kraken’s trading venues.

Key takeaways

• Nasdaq Ventures is investing $100 million in Payward, Kraken’s parent, at a reported $21 billion valuation, according to Bloomberg.
• Payward will roll out Nasdaq’s market surveillance technology across crypto, equities, tokenized equities, futures and options venues.
• The deal follows similar arrangements with the London Stock Exchange and Deutsche Börse, giving Payward simultaneous ties to three major exchange groups.
• Payward’s Q2 adjusted revenue reached $508 million, up 17% year-over-year, though platform transaction volume fell 18% to $310 billion.
• The SEC has approved a pilot program for Nasdaq’s tokenized shares, limited to Russell 1000 constituents and certain ETFs, with launch expected in the second quarter of 2027.

Nasdaq’s $100 Million Investment in Payward

The headline figure here is straightforward: Nasdaq‘s venture arm is writing a $100 million check into the company behind Kraken. What’s less clear is everything around that number. Nasdaq’s own release does not disclose a formal valuation, the size of the equity stake, whether the money buys newly issued shares or existing ones, or any governance rights attached to the deal.

Valuation and Investment Terms

Bloomberg put the valuation at $21 billion, based on people familiar with the matter. That number matters because it marks a partial recovery for Payward. The company had raised $800 million in November 2025 at a $20 billion valuation from investors including Citadel Securities, Jane Street and DRW Venture Capital. Five months on, a $200 million investment from Deutsche Börse valued Payward at approximately $13.3 billion, representing roughly 1.5% on a fully diluted basis and marking a 33% discount compared to the November round. Measured against that April price, the Nasdaq round represents a 58% increase in Payward’s valuation.

Strategic Positioning with Major Exchanges

Nasdaq now holds equity in the very venue it has chosen to distribute its own tokenized shares outside the United States. The timing is notable: the deal lands just nine days after Payward struck a comparable arrangement with the London Stock Exchange. That means Payward is now simultaneously building the same kind of relationship with three exchange groups at once — Nasdaq, the London Stock Exchange Group and Deutsche Börse — each of which is racing to build its own route into tokenized equities. Wells Fargo served as Nasdaq’s exclusive capital markets advisor on the transaction.

Why this matters: when the exchange that hopes to distribute tokenized shares also owns a stake in the settlement partner handling those shares, the two companies’ incentives become tightly aligned — for better or worse, depending on how regulators and competitors view the arrangement.

Nasdaq Surveillance Technology Comes to Payward’s Trading Venues

Beyond the investment, Payward is becoming a paying Nasdaq customer. The company will adopt Nasdaq’s market surveillance technology across its crypto, equities, tokenized equities, futures and options venues, folding a widely used piece of exchange-grade compliance infrastructure into Kraken’s trading operations.

Neither company has disclosed what Payward will pay for the surveillance product, or whether that contract was priced separately from the $100 million investment. Nasdaq’s own forward-looking disclosure explicitly flags both halves of the arrangement — the benefits of tokenized-equities infrastructure and Payward’s adoption of the surveillance system — as statements that are not guarantees of future performance. That kind of hedging is standard in corporate filings, but it underscores how much of this deal still rests on execution rather than settled outcomes.

Tal Cohen, president of Nasdaq, framed the expanded relationship as a bet on infrastructure. “Our conviction that the company can play an important role in building the infrastructure that supports this evolution,” he said, describing the broader shift toward blockchain-based markets. Inside Nasdaq, the work sits with Digital Liquidity Networks, the same markets unit the company pointed to when justifying its August acquisition of LeveL Markets.

Payward’s Growth Numbers Tell a Mixed Story

Payward’s underlying business is growing, but not uniformly. The company reported $508 million in adjusted revenue for the second quarter, up 17% year-over-year, with adjusted EBITDA of $23 million.

Revenue and EBITDA

Funded accounts rose 42% to 6.6 million, a sign that new users are still signing up despite a maturing crypto market. Co-CEO Arjun Sethi confirmed in April that Payward had filed a confidential draft S-1 with the SEC in November 2025, keeping a public listing on the table as an eventual option.

Platform transaction volume, however, fell 18% to $310 billion — a reminder that revenue growth and trading activity don’t always move in the same direction. That decline sits alongside Nasdaq shares trading at $93.68 on the morning the deal was reported, down 0.6% from the previous close, putting Nasdaq’s own market capitalization at roughly $52 billion.

Sethi built much of his public case for the partnership around clearing-house mechanics rather than trading volume. More than $2 trillion in stock trades run through the U.S. clearing system daily, he said, with buys and sells netting down by roughly 98%. The clearing house still holds between $10 billion and $20 billion in collateral against the remainder while trades wait to settle. “Cutting that wait from two days to one in 2024 released $3 billion. Onchain settlement removes the wait,” Sethi said, adding that “the next phase of the collaboration is planned to advance Nasdaq Equity Tokens onto rails that do not close, with shareholder rights intact.” The $3 billion figure lines up with findings from the DTCC, SIFMA and ICI, which reported in September 2024 that the NSCC Clearing Fund fell by an average of $3 billion, or 23%, from $12.8 billion under T+2 to $9.8 billion after the May 2024 shift to T+1 settlement.

Tokenized Equities: Nasdaq Equity Tokens, SEC Pilot, and Payward’s xStocks

The tokenized-equities piece of this partnership is where the long-term ambition lives, and where regulatory reality is still catching up.

Nasdaq Equity Tokens and Legal Equivalence

Nasdaq Equity Tokens, or NETs, are issuer-sponsored, which separates them from third-party wrapped tokens issued by outside platforms. According to the framework Nasdaq released in March, the blockchain-based record is directly incorporated into the issuer’s official share registry. When a token is transferred, it moves the actual underlying security, granting it the same legal standing as a standard share instead of acting as a derivative or synthetic representation of it.

SEC Pilot Trading Program and Launch Timeline

Regulatory permission, though, is narrower than the broader ambition. The SEC approved Nasdaq’s rule change on March 18, as modified by a second amendment, and that approval covers trading in tokenized form only within a pilot program operated by The Depository Trust Company. Only Russell 1000 constituents and certain ETFs are included in the pilot program. Before trading can actually commence, Nasdaq is required to notify members at least 30 calendar days in advance, and the two companies anticipate rolling out NETs during the second quarter of 2027, placing it at the tail end of the H1 2027 timeframe Nasdaq had initially suggested in March. CNBC has also reported the companies are eyeing that 2027 window for tokenized stock trading.

Payward’s xStocks Settlement Role and Limits

As outlined back in March when Nasdaq first designated Kraken as its settlement layer, Payward’s role involves conducting KYC and AML checks and settling NET transactions in eligible jurisdictions via its xStocks platform. That role explicitly excludes the United States and the United Kingdom, where xStocks is not offered; the product runs through licensed entities in Bermuda and Cyprus instead.

xStocks has already built some scale. In July, Payward reported that the platform had surpassed $35 billion in total transaction volume during its first year, including $12.5 billion settled onchain spanning seven networks, alongside close to 200,000 holders. But outstanding value tells a smaller story: tokenized stocks held about $2.93 billion in distributed value as of September 9, according to RWA.xyz, with xStocks ranking third at $631 million, behind Ondo at $859 million and Binance’s bStocks at $647 million. In July, Payward further noted, referencing CoinGecko data, that xStocks represented eight out of the 15 largest tokenized stocks ranked by market capitalization.

Competition for the tokenized-listing business is already direct and public. On September 1, the London Stock Exchange announced plans, pending regulatory approval, to list xStocks and trade them on its LSE 24 venue during 2027, the same year Nasdaq anticipates launching NETs via the identical distributor. Meanwhile, NYSE is developing its own separate 24/7 tokenized equity platform using private blockchains, independent of either arrangement.

Why this matters: three of the world’s largest exchange groups are now converging on the same settlement partner to reach tokenized markets, even as they compete against each other for listings. That overlap raises the stakes for Payward, whose infrastructure could end up underpinning multiple rival platforms at once — assuming adoption actually materializes at scale beyond the current pilot limits.

FAQ

What is the significance of Nasdaq’s $100 million investment in Payward?

The investment values Payward at $21 billion and extends Nasdaq’s partnership to include market surveillance technology adoption, positioning Payward alongside major exchanges building tokenized equity infrastructure.

How does Nasdaq’s market surveillance technology fit into Payward’s operations?

Payward will implement Nasdaq’s surveillance technology across various trading venues including crypto, equities, tokenized equities, futures and options, though the financial terms of that arrangement remain undisclosed.

What regulatory approval has Nasdaq received for trading tokenized equities?

The SEC approved Nasdaq’s rule change for a pilot trading program on March 18, limited to Russell 1000 constituents and certain ETFs, with NETs expected to launch in the second quarter of 2027.

What is Payward’s role in the tokenized equities ecosystem?

Payward operates the xStocks settlement layer, which handles KYC and AML compliance and settles transactions in eligible jurisdictions, excluding the United States and the United Kingdom.

Article produced with the assistance of artificial intelligence and reviewed by the editorial team.