Payward to Offer Global Retail Tokenized US IPO Access via xStocks

Payward, the parent company of crypto exchange Kraken and developer of the xStocks tokenized equities framework, is set to offer retail investors access to U.S.-listed initial public offerings at the IPO price. The launch is expected in the coming weeks, when customers of Kraken and select xStocks partners will be able to register interest in a U.S.-listed IPO before the company goes public, then receive an allocation of tokenized shares at the IPO price on listing day, Payward said in a statement shared with The Block on Wednesday.

IPO access at the offering price is typically reserved for institutional investors, private banking clients, and select platforms with established underwriter relationships. Retail investors in some countries don't have any option to participate, and in others, they can only buy after stocks begin trading on the open market. This often leaves them unable to participate until after trading begins, when prices may already have moved above IPO levels, Payward said, something it hopes to change.

"Going public should mean public to everyone. For decades, getting in at the IPO price has been a privilege of geography and net worth, and the most exciting moments in capital markets have been reserved for the investors closest to them. That worldview is breaking down," Mark Greenberg, Global Head of Payward Services, said. "Now a retail investor in Medellín, Madrid, or Malaysia can have similar access to a U.S.-listed IPO."

How it works: According to the statement, partner exchanges open an "indication of interest" window for users in the weeks leading up to each public listing, where customers can submit non-binding offers to buy within the company's indicated price range. Payward then aggregates that demand and works with an underwriting syndicate on behalf of xStocks partners. Allocations are finalized at listing day, and shares are tokenized, backed 1:1 by the underlying stock, held in custody by a regulated entity, then distributed to eligible users via their exchange.

"Investors receive their allocation at similar offering prices as institutional participants, not at a market price that has already moved," Payward said.

xStocks, originally developed by Backed Finance before the company was acquired by Payward, handles the tokenization process. xStocks tokens are blockchain agnostic and interoperable across chains, including Ethereum, Solana, and TON. They are also composable with DeFi protocols, meaning investors are free to move them across platforms.

xStocks has emerged as a leading avenue for tokenized equities, having surpassed $30 billion in total transaction volume, with more than $6 billion settled onchain, across more than 125,000 unique holders, according to the firm.

Payward said it plans to expand the offering to additional markets and add more xStocks Alliance partners in the months ahead.

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