USDT Hadron, the tokenization arm of issuer Tether, is partnering with ETF issuer KraneShares and Bitfinex Securities to develop and scale tokenized financial products, the companies announced in a statement Thursday.
The initiative plans to create tokenized versions of exchange-traded products and create the necessary systems for them to be traded on regulated digital asset platforms.
The companies plan to test institutions’ appetite for such products and work on the legal and operational design needed to bring them to market.
Hadron by Tether will provide the tokenization technology, while Bitfinex Securities offers a licensed trading platform under El Salvador’s regulatory oversight. KraneShares, the asset manager best known for its China-focused ETF, plans to move entirely to tokenized offerings in the coming years.
“We believe our business over the next three to four years will be 100% token, and this strategic agreement represents an important step toward that future,” said Jonathan Krane, CEO of KraneShares.
The deal comes as financial institutions explore how to bring real-world assets such as stocks, bonds and ETFs on-chain. According to industry projections, tokenized markets are expected to grow from around $30 billion today to trillions over the decade.
In practice, a tokenized ETF could allow investors to purchase exposure to a fund using digital wallets, with near-instant settlement and fewer intermediaries. Tokenization could also be an attractive new distribution channel for asset managers, particularly in emerging markets where average investors don’t necessarily have a brokerage account to access products like an ETF.
