Nasdaq’s venture arm is investing $100 million in Payward, the parent company of crypto exchange Kraken, in a deal that values the company at $21 billion. Bloomberg reported the investment on Thursday, citing people familiar with the matter.

The investment extends a partnership established in March. Under the arrangement, Kraken will distribute Nasdaq’s tokenized stocks through its platform, giving customers access to Nasdaq-listed equities in token form. The products would carry the same voting rights as ordinary shares traded on the exchange.

Most tokenized equity products provide holders with price exposure but no additional shareholder rights. Nasdaq’s approach places issuers at the center of the structure. The exchange operator has been building a gateway with Kraken to move tokenized equities between regulated markets and on-chain venues. Kraken already offers tokenized equities through Payward Services, its business-to-business arm. The planned distribution and Nasdaq’s proposed token launch are the next stated developments in the partnership.

Established exchanges take stakes in crypto firms

Nasdaq is the third established exchange operator to take a stake in a crypto exchange this year. Intercontinental Exchange, the owner of the New York Stock Exchange, invested in OKX in March at a $25 billion valuation. The deal included a board seat for ICE and an agreement to open NYSE tokenized-equity markets to OKX’s 120 million accounts. ICE announcement

The following month, Deutsche Börse paid $200 million for a 1.5% stake in Payward. Nasdaq also plans to launch its own token in the second quarter of next year, according to Bloomberg’s sources.

Payward’s valuation has shifted during the period. The company raised $800 million at a $20 billion valuation last November and used the same valuation in April when it agreed to acquire derivatives exchange Bitnomial. Deutsche Börse’s investment, made that same month, implied a valuation of about $13.3 billion, according to Bloomberg’s calculation.

Payward’s path to the public markets has also slowed. The company filed a confidential S-1 registration statement in November but shelved the listing in March. That was the same month Kraken became the first crypto firm granted access to the Federal Reserve’s core payments system.

Source: Decrypt