Kraken Introduces Yield Vaults for Tokenized Stocks

Kraken has introduced onchain yield vaults for tokenized stocks, allowing investors to earn additional returns while retaining exposure to the underlying equity. The initial vaults cover SPYx, QQQx, and NVDAx, with launch APYs of 2% for SPYx and QQQx, and 1.8% for NVDAx, net of fees.

The xStocks serve as collateral, while borrowed stablecoins generate DeFi rewards through protocols like lending and yield farming. Investors can request withdrawals at any time, subject to a three-day waiting period, but should be aware that the deposits are not covered by government or bank protection programs.

Kraken warns that users could lose some or all of their allocation due to smart-contract, liquidity, bad-debt, and market risks associated with the vaults. The relevant comparison for investors is not simply 2% versus zero, but rather receiving additional potential return in exchange for introducing a DeFi strategy between themselves and their tokenized equity exposure.