- LSEG and Payward partner to tokenize the LSE’s top 100 stocks on-chain.
- LSEG plans to allow trading of these products on its new platform, LSE 24.
- Payward is already expanding xStocks to cover international stocks like Hong Kong.
The London Stock Exchange is making one of its biggest steps into blockchain-based finance yet.
London Stock Exchange Group (LSEG) has teamed up with Kraken’s parent company, Payward, to create tokenized shares of the 100 largest companies on the London Stock Exchange, bringing them on-chain.
This could give crypto investors another way to get into traditional stocks and push one of the world’s oldest exchanges further into the tokenization race.
How Will the Deal Work?
Through the partnership, Payward plans to turn the 100 biggest UK-listed stocks into xStocks, which are blockchain tokens tied to real public shares.
If regulators give the green light, LSEG plans to allow trading of these products on its in-the-works new platform, LSE 24. The proposed launch is expected in 2027, and LSE 24 is being built as part of the exchange’s push for longer, more flexible trading hours.
The appeal behind this is simple: traditional stock markets only run for certain hours, but blockchain markets can potentially go 24/7. Also, by tokenizing these shares, investors may trade them with faster settlement and easier integration with crypto wallets and blockchain platforms.
It’s worth noting, however, that having xStocks isn’t the same as owning shares.
xStocks are tokenized versions meant to track the value of actual shares. They’re usually backed by the real thing, but holders might not get the same legal rights or shareholder perks as someone who buys the shares through a regular broker.
Tokenization is on the Rise
While tokenized stocks have existed for some time, having LSEG (the group behind one of the world’s biggest and most important stock exchanges) involved with tokenization is a huge deal.
This makes tokenization an increasingly notable financial trend. For instance, last year, Robinhood rolled out tokenized stocks in the EU, putting additional pressure on traditional brokers and exchanges to explore blockchain-based securities. Coinbase is getting into tokenized assets as well, with the exchange launching tokenized shares on Base just last week.
As for Payward itself, it was already expanding xStocks to cover international stocks, with plans to include markets like Hong Kong and South Korea.
Still, the success of tokenized equities may depend less on whether blockchain technology works and more on whether regulators and exchanges can set clear rules around custody, shareholder rights, and settlement.
Related: Why Is the UK Suddenly Becoming More Friendly to Stablecoins?
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