The London Stock Exchange said on September 1 that it will develop UK tokenised equity structures and has formed a partnership with Payward, the parent company of crypto exchange Kraken, to explore how regulated market infrastructure can connect with on-chain ecosystems. The announcement opens a route for the exchange to list xStocks, one-to-one backed tokenised representations of publicly traded shares, on its 24-hour trading venue LSE 24 in 2027, subject to regulatory approval. LSEG, whose market heritage stretches back more than three centuries, is positioning the initiative as part of a broader modernisation of capital-markets infrastructure.
The exchange framed the move as a way to broaden access to capital markets without weakening the shareholder rights, protections and governance standards that underpin public markets. The work will consider how LSEG’s Digital Securities Depository (LSEG DSD), its digital settlement and servicing infrastructure for tokenised securities, could support settlement and asset servicing, alongside the Digital Settlement House (LSEG DiSH) that enables programmatic settlement between independent payment networks.
What the Partnership Entails
The Payward collaboration will focus on digital-native access, wallet-based interaction and connecting tokenised and traditional infrastructure. The two companies said they will explore how issuers and investors can make greater use of public and private blockchains while continuing to meet regulatory obligations such as anti-money laundering and operational resilience requirements.
Payward already works with brokerage firm GTN to offer tokenised equities through the xStocks product, and the LSE partnership extends that model into a regulated exchange setting. Arjun Sethi, Payward’s co-chief executive, described bringing London-listed companies on-chain as xStocks as “the start” of securities moving onto blockchain rails.
A Regulated Route for Tokenised Equities
The initiative lands as traditional market-infrastructure operators move tokenised products into production. Intercontinental Exchange, owner of the New York Stock Exchange, recently tapped tZERO to build tokenised securities infrastructure, while venues such as Bybit have integrated the xStocks product to bridge crypto and tokenised equities. xStocks can move between centralised exchanges, self-custodied wallets and on-chain applications, giving holders utility that a share sitting in a traditional brokerage account cannot currently offer.
Julia Hoggett, chief executive of LSE plc and head of digital and securities markets at LSEG, said tokenisation “has the potential to change how investors access, and how issuers use, financial markets, but it must develop in a way that preserves the trust, rights and role of regulated markets.”
What Still Depends on Regulators
The listing of xStocks on LSE 24 remains contingent on regulatory approval, and the exchange has committed to no firm launch date beyond the 2027 target. The announcement does not specify which companies’ shares would be tokenised first, how custody and trading volume would be handled at scale, or the economic terms of the Payward partnership. Regulators will also need to be satisfied that a tokenised wrapper preserves the shareholder protections and price integrity of the underlying London-listed shares.
Until regulators sign off and the first instruments are listed, the partnership is best understood as a commitment to build a rights-preserving route for tokenised public equities rather than evidence of completed adoption. The exchange said the effort forms part of a broader digitalisation programme that also includes LSE 24, LSEG DSD and LSEG DiSH.
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