Crypto brokerage firm Alpaca raises $135 million for tokenized stock infrastructure

Alpaca, a crypto brokerage infrastructure firm, has raised $135 million to further develop its infrastructure for tokenized U.S. stocks. This funding round, led by Peak XV with participation from Elefund, BNP Paribas’ Opera Tech Ventures, and Unbound, follows a $150 million Series D round earlier this year that valued the company at $1.15 billion. Including debt financing primarily from Kraken’s parent company Payward and BMO, Alpaca has secured a total of $435 million to date.

The company currently clears or holds in custody about 94% of tokenized U.S. equities and manages over $1.5 billion worth of the underlying stocks backing these tokenized assets. Alpaca’s technology enables exchanges and tokenization platforms, including notable players like Binance, Ondo, and Dinari, to connect traditional U.S. stock equities to blockchain settlement rails, facilitating 24/7 minting and redemption of tokenized stocks.

Despite the advancement in tokenization, the process still requires regulated firms to hold the actual underlying shares and handle corporate actions, which remains a significant operational constraint. Alpaca’s Instant Tokenization Network addresses some of these challenges by allowing market participants to directly mint or redeem tokenized shares against the real-world stock inventories any time, often linking blockchain-based stock exposure to stablecoin funding.

This investment highlights ongoing efforts to bridge traditional equity markets with blockchain technology while underscoring the regulatory and infrastructural complexities involved. The developments supported by this funding may enhance liquidity and accessibility for tokenized equities but will still need to navigate the compliance demands tied to custody and corporate actions.