Will Bitcoin, ETH Get Replaced by Tokenized Equities? Kraken's Arjun Sethi Says No

Kraken co-CEO Arjun Sethi says capital is increasingly rotating beyond Bitcoin and Ethereum into perpetual futures, pre-IPO companies and tokenized equities, with AI-linked assets emerging as a Crypto Capital Has New Places To Go, Where?In a CNBC interview on Wednesday, Sethi pushed back against viewing crypto as a single speculative asset class defined by Bitcoin, Ethereum, altcoins and meme coins."There is always a rotation of capital," he said, pointing to growing U.S. investor interest in AI and emerging technologies.Crypto markets are reflecting the same trend through new products, according to Sethi.While capital may move between these products, Sethi argued that it remains part of the broader crypto liquidity ecosystem.Tokenization And Institutional Capital Drive Crypto RotationSethi said the AI trade is not pulling capital away from crypto but reflects a broader rotation like shifts between gold, commodities and other assets.Crypto’s advantage, he said, is its global, permissionless access.Tokenization could bring more equities, commodities and other traditional assets on-chain, with Asia among the fastest-growing markets positioned to benefit.He called these rotations "healthy," adding that capital can move back toward Bitcoin as monetary conditions change while tokenization expands the assets available through crypto rails.Sethi also pointed to rising institutional participation across Bitcoin, Ethereum, stablecoins and crypto infrastructure over the past two years.In August 2026, Bitcoin ETF inflows reached $3.5 billion, the highest since October 2025, while Ethereum ETF inflows hit $1.85 billion, their strongest level since August 2025.Image: Shutterstock Read Also: