On March 9, 2026, a message was released from the official xStocks tokenized stock project: it will form a strategic partnership with global exchange giant Nasdaq and Payward, the parent company of compliant cryptocurrency exchange Kraken, to jointly develop a brand new “market gateway.” According to a report from the financial media on the same day, this cooperation aims to bridge the tokenized stock market with blockchain networks, connecting regulated traditional markets with unlicensed DeFi ecosystems. Through this solution, traditional assets will achieve round-the-clock global trading, cross-chain transfer, and greater collateral efficiency.

This is not a simple technical collaboration, but rather the first standardized “compliance bridge” between traditional finance and the blockchain world. If the explorations in the RWA sector over the past few years were merely “paving the way” in isolation, then the collaboration between Nasdaq and Payward is laying down the “tracks” for the migration of trillion-dollar assets. As Nasdaq President Tal Cohen emphasized when interpreting this plan, the new initiative focuses on the needs of corporate issuers and is committed to integrating these needs into tokenization solutions—this reflects the serious interest of traditional financial giants in the on-chain world.

Some say this is the long-awaited “compliance moment” for DeFi, while others describe it as the first “official admission ticket” Wall Street has handed to the crypto world. Regardless, when a name like Nasdaq is paired with a technical term like “conversion gateway,” a clear signal has been sent: the liquidity revolution of tokenized assets has officially knocked on the door of DeFi.

The collaboration between Nasdaq and Payward is undoubtedly a milestone in the history of financial infrastructure development. It proves that “compliance” and “unlicensed” are not two eternally parallel lines but can evolve into a new hybrid form through sophisticated engineering design and regulatory communication. The “conversion gateway” is like the English Channel Tunnel of the financial world, allowing London, representing “depth and regulation” (TradFi), to connect directly with Paris, representing “efficiency and innovation” (DeFi).

1. What exactly is the “conversion gateway”

When we talk about “stock on-chain,” we often fall into a mindset that sees it merely as traditional securities issuers converting stock certificates from paper to a string of code. However, the collaboration between Nasdaq and Payward is far more than that. Its essence lies in the repeatedly mentioned term—“conversion gateway.”

To understand the revolutionary nature of this “gateway,” we first need to clarify the awkward state of the current market. In fact, attempts to tokenize US stocks did not start today. As early as the DeFi Summer of 2020, projects like Synthetix and Mirror Protocol attempted to mint “synthetic assets” pegged to US stock prices by over-collateralizing cryptocurrency assets. However, as pointed out in an article by Jingtian Gongcheng Law Firm, these assets resemble derivatives lacking underlying support rather than actual equity. Critics also noted that early tokenized stocks lacked rights such as dividends and voting at shareholder meetings, resulting in serious tracking errors. The crux of the problem lies in the fact that they remained trapped in the encrypted “closed-loop,” unable to touch the true “origin” constituted by regulation and physical assets.

The “conversion gateway” designed by Nasdaq and Payward aims to bridge this origin with the crypto world. According to reports, Nasdaq President Tal Cohen emphasized that this new initiative focuses on the needs of corporate issuers and aims to incorporate these needs into the tokenization scheme. This means that the gateway is not just a simple cross-chain bridge, but a comprehensive protocol layer integrating compliance verification, identity authentication, asset locking and minting, and cross-chain transfer.

Its operational logic can be understood this way: when a publicly listed company’s stock enters the blockchain world through this gateway, it remains a traditional security compliant with all SEC (U.S. Securities and Exchange Commission) regulatory requirements on the Nasdaq market side, possesses a unique CUSIP number (Committee on Uniform Securities Identification Procedures number), and undergoes final settlement through a deposit trust and clearing company (DTCC). In the on-chain world, it is minted as a programmable token following standards such as ERC-20 or SPL. The two forms of assets can be exchanged and converted 1:1 through this “gateway” at any time, as they represent the same underlying value and ownership.

The brilliance of this design lies in “divergence” and “convergence”: compliant funds and users can operate on a protected traditional track directly connected to the DTCC clearing system; while funds pursuing efficiency, composability, and global liquidity can enter the crypto track through the gateway. Both can run parallel without conflict and achieve seamless value conversion at the gateway. This is no longer a one-way narrative of “stock tokenization,” but a bi-directional flowing financial “wormhole.” It first realizes that traditional assets possess the native soul of crypto without sacrificing compliance.

2. DeFi's “opening floodgates” and TradFi's “decoupling”

Why is such a “conversion gateway” referred to as the “Holy Grail” of the financial world? Because it simultaneously addresses two core pain points that stand between DeFi and TradFi.

For DeFi, this is a long-desired “asset opening floodgates.” For a long time, DeFi's collateral has been highly concentrated in a few native crypto assets such as BTC and ETH. This not only leads to a strong correlation in asset prices and cyclical fluctuations but also keeps DeFi's scale restricted within the crypto circle, making it difficult to achieve true “going beyond.” According to analytical articles by Web3 lawyers on Gate, the most successful RWA (real-world asset) currently is stablecoins, and the RWA poised for explosive growth is stocks of listed companies. Once blue-chip stocks like Apple and NVIDIA pour into DeFi through compliant gateways, they will become the highest quality, relatively low volatility, and institutionally graded collateral tightly bound to traditional financial markets.

This trend has already begun to surface. In October 2025, general collateral infrastructure Falcon Finance announced its collaboration with Backed to integrate xStocks into its collateral framework. This means users can use tokenized stocks like Tesla (TSLAx) and NVIDIA (NVDAx) as collateral to mint their over-collateralized synthetic dollar USDf. Andrei Grachev, founding partner of Falcon Finance, commented, “With xStocks, users can maintain exposure to companies like Tesla or NVIDIA while releasing a steady flow of liquidity.” This perfectly illustrates how tokenized stocks can evolve from a static store of value into programmable, yield-generating “financial building blocks” in the DeFi paradise. Following this, in February 2026, Ondo Finance also announced its DeFi application centered around tokenized U.S. stocks has officially launched, allowing assets like QQQon and TSLAon to serve as institutional-grade collateral for on-chain lending and structured products. This marks the accelerated mainstream adoption of tokenized stocks as collateral within the Ethereum DeFi ecosystem.

For TradFi, this represents a thorough “efficiency decoupling.” The reason traditional financial markets have not been able to achieve 7x24 hour trading is not the technology of matching systems but the real bottleneck lies in clearing, settlement, and margin management highly reliant on bank operating hours. As mentioned in the Web3 lawyers’ analysis article, once the banking system closes, flows of capital and risk control will experience breakpoints. The “conversion gateway” brings tokenization solutions that endow assets with the ability to move around the clock. When stock tokens can be transferred and traded at any time and anywhere globally, the margin calculations and capital allocations based on these assets can be automatically and in real-time executed on-chain via smart contracts. Nasdaq’s competitor, the New York Stock Exchange, has already recognized this and is building a trading platform using blockchain technology to cover funding gaps during non-business hours through on-chain settlement and tokenized funding tools.

The structural shocks brought by this transformation are massive. When transactions, clearing, and capital management can be completed on the same technical layer (the blockchain), the value chain originally distributed among different financial institutions (banks, brokers, custodians) will be compressed. Funds no longer need to reside within the banking system to complete investment cycles; the future potential path could be “wallets as accounts, settlements as completions.” This is not about overturning existing financial institutions but about an ultimate optimization of financial service processes.

3. The triple play of compliance, regulation, and technology

However, any great technological vision must eventually return to the foundational reality. Whether the “rails” connecting the two worlds can operate smoothly depends on whether the “trio” of compliance, regulation, and technology is harmonious.

First, compliance is the sturdiest sleeper for these rails. In the United States, Nasdaq's proposal has not emerged from thin air, but has been built upon years of regulatory groundwork. In April 2025, the SEC officially released the “Compliance Guidelines for Tokenized Securities Issuance and Trading,” which first clarified the regulatory standards for tokenized securities, requiring issuers to disclose information about blockchain technology architecture, smart contract risk points, etc., and requiring trading platforms to obtain ATS (Alternative Trading System) licenses. In September 2025, Nasdaq formally submitted a rule change application to the SEC, which aims to tokenize stocks of giants like Apple and Microsoft, perfectly aligning with the SEC's regulatory direction to promote the establishment of digital asset securitization standards. It is worth noting that this proposal is still awaiting the SEC's final approval. This reminds us that all innovations must be cautiously maneuvered in the regulatory “slow lane.”

Payward, the parent company of Kraken, plays a particularly key role in this. According to reports from CoinDesk and Coinspeaker, Payward achieved an adjusted revenue of $2.2 billion in 2025, a year-on-year increase of 33%. More importantly, its asset-based businesses (custody, yield products, payments, financing) accounted for 53% of revenue, surpassing trading business (47%) for the first time. This change in revenue structure shows that Payward has successfully transformed from a singular crypto exchange into a comprehensive financial infrastructure provider. In 2025, it also obtained the EU MiCA license and the UK EMI license. This deep accumulation in compliance is the key reason Nasdaq chose it as a partner—it injects the most valued genes of the traditional financial world into this “gateway”: trust and compliance.

Second, the diversity of global regulation constitutes different road conditions that this “railway” must face. In China, regulators have clearly established the principle of “strictly prohibited domestically, strictly regulated overseas” for RWA tokenization activities. According to a notification jointly released by the People’s Bank of China and eight other departments in February 2026, RWA tokenization activities are strictly prohibited domestically, but domestic entities are allowed to engage in related businesses abroad in compliance with strict filing and approval procedures. Peking University's distinguished professor Tian Xuan pointed out that the cross-border nature of RWA tokenization easily bypasses capital controls and compliance reviews, hence the “strict prohibition domestically” is a necessary requirement to prevent chaotic fund flows and systemic risks. At the same time, “strict regulation overseas” opens a compliant financing channel for truly need-based enterprises, such as Longsin Group and Xiexin Energy, to issue RWA projects based on new energy assets in Hong Kong. This “internal and external difference” design essentially exchanges space for time, while strictly controlling risks, leaving a valuable window for technological innovation and international exploration.

Lastly, technical and operational risks remain the looming “sword of Damocles.” As key infrastructure, the “conversion gateway” itself will become a target of hacker attacks, and the security of cross-chain assets and smart contract vulnerability risks cannot be ignored. Meanwhile, the challenge of seamlessly executing KYC/AML rules in different jurisdictions without disrupting the decentralized user experience is a significant product design challenge. A deeper concern is whether, when the core assets and liquidity entry of DeFi are controlled by a few compliant gateways, this will create an inherent tension with the original intent of DeFi’s “decentralization” and “permissionless.” Whether a “regulated DeFi” sub-ecosystem led by compliant entities is a triumph for DeFi or the beginning of assimilation by traditional rules is a question that currently lacks a standard answer.

4. How do we board this train to the future

Looking back at the scene at the beginning of the article, it is no longer science fiction. When your Tesla stock can earn you yield in a DeFi protocol, and global capital can pursue the most valuable U.S. company equity 7x24 hours without obstruction, we are indeed witnessing the birth of a new financial species. It combines the physical value and legal protection of traditional assets with the liquidity and programmability of crypto assets.

As historian Niall Ferguson once pointed out, the essence of finance is the transfer of value across time and space. And this time, the “rails” laid by the partnership of Nasdaq and Payward will allow the transfer of value to cross the last barrier—the gap between institutions and technology. The future of RWA is thus opening a new chapter. The ultimate direction of this new chapter does not depend on Nasdaq or Kraken, but on every developer building applications on it, and every one of us using it for trading and investing.

(This article is solely for industry research discussion and does not constitute any investment advice. The RWA and crypto asset markets are highly volatile and uncertain, involving cross-border regulatory risks. Readers are urged to make cautious decisions based on a thorough understanding of relevant risks.)

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