- Kraken now lets eligible users outside the United States use select tokenized stocks and ETFs as collateral for leveraged trading.
- The exchange applies risk haircuts and collateral limits, meaning the assets do not count at full market value.
- The move shows tokenized real-world assets are becoming more useful in crypto markets, but traders still need to understand the risks of leverage.
Kraken is expanding how tokenized assets can be used on its trading platform. According to Cointelegraph, the exchange has started accepting certain tokenized stocks and exchange-traded funds, or ETFs, as collateral for futures and margin trading.
Collateral is an asset a trader posts to support a position. In simple terms, it acts as a backup if the trade moves against them. Kraken’s update means eligible clients can use supported tokenized assets as collateral without selling those holdings first.
The feature is not available to users in the United States. Cointelegraph reported that futures collateral support is available in the European Economic Area, while margin collateral support is available in other eligible jurisdictions outside the bloc.
The initial list includes 10 tokenized stocks and ETFs, including Apple, Nvidia, Tesla, Strategy, the SPDR S&P 500 ETF and Invesco QQQ Trust. Kraken is also applying different risk discounts, known as haircuts. Broad-market ETFs receive a 10% haircut, while more volatile stocks such as Strategy and Robinhood are discounted by 30%.
That matters because a haircut reduces how much collateral value a trader can borrow against. For example, an asset worth $1,000 with a 30% haircut may only count as $700 in collateral value. Kraken has also set collateral limits, with broad-market ETFs capped higher than most individual stocks.
The announcement is part of a wider trend in tokenized real-world assets. These are traditional assets, such as stocks, funds or Treasurys, represented on a blockchain. They are increasingly being used for trading, lending, settlement and collateral, rather than only being held as on-chain versions of traditional investments.
For exchanges and token teams, the development is another sign that tokenization is moving into more practical financial infrastructure. For users, it also adds complexity. Leveraged trading can increase losses as well as gains, and tokenized assets may carry platform, liquidity and regulatory risks.
Coinsult does not provide financial advice. Traders should understand how collateral rules, liquidation levels and local restrictions work before using tokenized assets in leveraged products.
