The London Stock Exchange is moving deeper into blockchain-based finance through a new partnership with Payward, the parent company of Kraken and the firm behind the xStocks tokenized-equities platform.
Under the agreement, some of the UK’s largest publicly traded companies will soon have blockchain-based versions of their shares available through xStocks.
Payward and London Stock Exchange Group said Tuesday that the 100 biggest companies listed on the LSE will be added to the platform over the coming weeks. Each xStock represents an underlying share on a one-to-one basis and can be traded continuously on centralized crypto exchanges, held in self-custody wallets or used within onchain applications.
The initiative reflects the growing effort among traditional financial institutions to bring conventional assets onto blockchain infrastructure. Banks, exchanges and other market participants have increasingly explored tokenized stocks, bonds, commodities and other real-world assets as a way to make trading and settlement more flexible.
Traditional equities typically move through brokerage accounts and established clearing systems during market hours, with settlement involving several intermediaries. Tokenized shares can operate continuously and be transferred directly between blockchain wallets or integrated into decentralized applications while maintaining exposure to the underlying security.
xStocks Expands Across Markets
Payward said xStocks has generated more than $40 billion in trading volume since launching a little over a year ago. Nearly $20 billion of that activity has taken place directly on blockchain networks, and the platform now counts more than 200,000 holders.
The addition of UK-listed equities could make the market accessible to investors in more than 110 countries through blockchain-based infrastructure. UK investors, however, are currently unable to use xStocks.
If regulators approve the plan, the LSE intends to list xStocks and facilitate their trading through LSE 24, its proposed round-the-clock trading venue.
The exchange ultimately expects the framework to cover tokenized equities from the UK, US, EU and Hong Kong, with additional asset classes potentially added later.
LSE and Payward are also considering a model that would allow the exchange to issue equity tokens itself. Under the proposal, LSE members could issue and manage shares directly on blockchain networks while maintaining the same ownership rights and fungibility as traditional equities.
Traditional Markets Move Toward Tokenization
Payward co-CEO Arjun Sethi said the partnership reflects a changing relationship between the crypto and traditional financial industries, arguing that the two sectors do not necessarily have to replace one another.
LSE CEO Julia Hoggett emphasized the need for caution, saying tokenization must preserve confidence in regulated markets, protect investors and maintain the established rights associated with securities.
Beyond trading, financial firms are exploring whether tokenized securities can be used as productive collateral. Such applications could allow blockchain-based assets to support lending, unlock liquidity and facilitate new forms of credit in a manner similar to traditional government bonds.
Shares of London Stock Exchange Group fell about 2% in early London trading following the announcement.
