Kraken in ‘Build Mode’: Q2 Revenue Grows, Earnings Decline Amidst Multi-Asset & Tokenized Equities Expansion

Cryptocurrency exchange Kraken reported a notable 18% year-over-year increase in revenue, reaching $411.6 million for the second quarter of 2025. However, this growth was accompanied by a 7% decline in adjusted earnings, which fell to $79.7 million, reflecting the company’s ongoing transformation into a multi-asset trading ecosystem amid U.S. tariffs and broader macroeconomic uncertainties. This strategic evolution aligns with a broader industry trend as digital asset exchanges expand beyond the often-volatile cryptocurrency markets.

• Kraken’s Q2 2025 revenue hit $411.6 million, an 18% year-over-year increase.
• Adjusted earnings for Q2 2025 declined 7% year-over-year to $79.7 million.
• The exchange is in “build mode,” expanding into traditional equities and tokenized securities.
• Key Q2 initiatives included U.S. equities trading, 24/7 FX perpetual futures, and “xStocks.”
• Kraken is reportedly seeking $500 million in funding at a $15 billion valuation, eyeing a 2026 IPO.
• The tokenized equities market is growing but faces scrutiny over investor protections.

Kraken’s Strategic “Build Mode” and Q2 Performance

Kraken has characterized its current operational phase as “build mode,” indicating significant strategic investments aimed at expanding its infrastructure and diversifying its product suite. At the core of this strategy is a mission to provide universal access to trading a wide array of assets, including cryptocurrencies, traditional equities, and emerging tokenized securities. During Q2, the exchange introduced several key initiatives, such as enabling U.S. equities trading, launching 24/7 FX perpetual futures, and rolling out “xStocks”—a platform offering tokenized blue-chip stocks and exchange-traded funds (ETFs).

While these forward-looking investments are designed to position Kraken for sustained growth, they coincided with a quarter-over-quarter dip in financial metrics. Q2 revenue decreased by 13% from Q1’s $478 million, and adjusted EBITDA saw a more significant 57% decline, falling to $80 million from $187 million in Q1.

Robust Year-over-Year Growth and Future Outlook

Despite the quarter-over-quarter fluctuations, Kraken showcased robust year-over-year growth across several key performance indicators. Trading volumes for Q2 2025 increased by 19% to $186.8 billion, while assets under management (AUM) surged by 47% to $43.2 billion. The number of funded accounts expanded by 37%, reaching 4.4 million. Furthermore, Kraken’s market share for stablecoin-to-fiat conversions significantly improved, climbing from 43% to 68%. These strong indicators emerge amidst reports that Kraken is seeking $500 million in funding, which would value the company at $15 billion, ahead of a potential initial public offering (IPO) in 2026.

Industry Diversification into Tokenized Equities

Kraken’s strategic diversification is not an isolated move; the broader digital asset industry is increasingly embracing tokenized equities. For instance, Bybit, in collaboration with Backed Finance, recently launched tokenized equities on xStocks within the Solana DeFi ecosystem. Similarly, Robinhood now provides European customers with access to tokenized U.S. stocks and ETFs on the Arbitrum network. Major players like Coinbase have also signaled strong interest, with its Chief Legal Officer, Paul Grewal, publicly stating that tokenized equities represent “the future of finance.” Other prominent platforms such as eToro and Gemini are likewise developing or implementing similar offerings.

Regulatory Challenges and Investor Protections

Despite the perceived innovation and potential, the nascent tokenized equities market is attracting significant scrutiny, particularly concerning investor protections. Critics contend that certain tokenized equities, including those offered via platforms like xStocks or Robinhood, may not confer the same inherent rights or safeguards typically associated with direct share ownership in traditional markets.

While Backed Finance asserts that each xStocks token is 1:1 supported by a Special Purpose Vehicle (SPV) established in Liechtenstein—a structure designed to secure underlying assets even in the event of an exchange’s failure—the broader regulatory and legal frameworks governing these instruments remain in evolution. As Alan Keegan, DeFi portfolio manager at M31 Capital, observed, “There are regulatory questions and legal infrastructure to be built to get to a place where an onchain transaction of a security actually represents a transfer of that security.” This candid assessment underscores the significant ongoing challenges inherent in seamlessly integrating traditional financial assets with decentralized blockchain technology.