The London Stock Exchange has partnered with Kraken parent Payward to bring shares of the 100 largest London-listed companies onto the xStocks tokenization framework, opening the door for the products to eventually trade through the exchange’s planned 24-hour venue.
Summary
- London Stock Exchange and Kraken parent Payward will bring the 100 largest LSE-listed companies to the xStocks framework.
- The tokenized shares will be available to investors across more than 110 countries, though xStocks remain unavailable to UK investors.
- LSE plans to support xStocks trading on its LSE 24 venue, subject to regulatory approval.
- Payward and LSE will explore shares issued directly onchain with the same rights as traditional stock.
- xStocks have generated more than $40 billion in trading volume, including nearly $20 billion settled onchain.
Payward and the London Stock Exchange said Tuesday that the first batch of U.K. equities will become available as xStocks in the coming weeks, extending a tokenized stock platform that has already generated more than $40 billion in total trading volume. Nearly $20 billion of that activity has settled onchain, while the products have attracted more than 200,000 holders.
London Stock Exchange tokenization will start with 100 companies
Under the partnership, shares of the 100 largest companies listed on the London Stock Exchange will be made available through Payward’s xStocks framework.
Each xStock is backed one-to-one by the corresponding underlying security. The blockchain-based products can trade around the clock through supported centralized exchanges, move into self-custody wallets and interact with compatible onchain applications.
The planned London rollout would give eligible investors across more than 110 countries access to tokenized versions of U.K.-listed companies. xStocks are not currently available to investors based in the United Kingdom.
The agreement comes as Payward has been taking the framework beyond its original focus on U.S.-listed companies.
Crypto.news previously reported in July that Payward had partnered with financial infrastructure provider GTN to expand xStocks internationally, beginning with Hong Kong-listed shares before targeting the U.K., Europe, South Korea and other approved markets.
Under that arrangement, GTN agreed to provide execution, custody and record-keeping infrastructure spanning more than 90 international financial markets. At the time, xStocks supported more than 500 tokenized assets and had generated over $37 billion in transaction volume.
Activity has continued to climb since then. By Aug. 18, xStocks had processed more than $38 billion in total transaction volume as Kraken rolled out 7,000 U.S. stocks to eligible customers across the European Economic Area.
The service put conventional U.S.-listed shares alongside more than 700 xStocks and over 600 crypto assets within the same Kraken account. Traditional stock trading in the EEA is provided through Payward Europe Digital Solutions (CY) Limited, a Cyprus investment firm authorized under the European Union’s MiFID II framework.
Payward’s figures released with the LSE partnership now put xStocks volume above $40 billion, with nearly half of that activity having settled directly onchain.
LSE 24 could become a regulated venue for xStocks
The partnership extends beyond distributing tokenized London-listed shares through Payward’s existing network.
Subject to regulatory approval, the London Stock Exchange plans to list xStocks and support their trading on LSE 24, its recently announced round-the-clock venue. The platform is expected to eventually cover tokenized equities from the U.S., European Union, U.K. and Hong Kong, with other asset classes potentially added as the framework develops.
The exchange had already been preparing to extend access beyond conventional London market hours.
In July, the LSE was reported to be preparing a separate overnight market targeted for the first half of 2027. Initial plans called for the venue to offer exchange-traded products linked to the U.K. and U.S. stock markets.
LSE CEO Julia Hoggett said at the time that retail traders were showing interest in using London’s time zone to gain exposure to both U.K. and international assets.
The agreement with Payward now adds tokenized securities to the exchange’s plans for trading outside its standard session, although their listing remains subject to regulatory approval.
Payward co-CEO Arjun Sethi described the arrangement as a combination of regulated financial markets and blockchain infrastructure.
“For years, the assumption was that crypto and traditional finance were on a collision course, and one of them would have to lose. That was never the real story,” Sethi said.
Hoggett took a more cautious position on how tokenized markets should be developed.
Tokenization “must develop in a way that preserves the trust, rights and role of regulated markets,” she said.
Payward and LSE could issue shares directly onchain
A separate part of the partnership could take the companies beyond blockchain representations backed by conventionally issued shares.
Payward and the LSE said they will explore natively LSE-issued equity tokens, which would allow exchange members to issue and service shares directly onchain.
Under the proposed model, the blockchain-issued securities would be fully fungible with their traditional counterparts and carry the same rights as conventional shares.
That differs from the current xStocks structure, where tokens are issued against securities held through the product’s underlying custody framework.
Payward has been expanding how xStocks can be used as the platform gains volume.
In July, Kraken began allowing eligible customers outside the United States to use selected xStocks as collateral for futures and margin trading on Kraken Pro.
Ten assets were accepted when the feature launched, including tokenized versions of Apple, Nvidia, Tesla, Strategy, Robinhood, Alphabet and several major exchange-traded funds.
Futures collateral became available to eligible clients outside the U.S., including those in the EEA, while margin collateral was offered to qualifying users outside the U.S. but excluded EEA customers.
Kraken applies different collateral haircuts and limits depending on the asset. Broad-market products such as tokenized SPY and QQQ received 10% haircuts at launch, while several individual stocks carried 20% haircuts and more volatile securities received higher discounts.
The feature lets qualifying investors maintain exposure to tokenized shares while using the same holdings as collateral for other positions.
Tokenized equities are moving into existing market infrastructure
Tokenized equities have increasingly moved from crypto-native platforms toward infrastructure operated or connected to established financial institutions.
The LSE agreement puts Payward’s xStocks within a framework that could eventually include direct trading through a regulated stock exchange venue, while the companies’ work on native equity tokens would move issuance itself onto blockchain infrastructure.
For investors, the existing xStocks framework differs from conventional brokerage-held shares in how the assets can be transferred. Traditional equities remain inside market and custody systems that operate according to exchange and settlement schedules, while compatible tokenized products can be transferred between wallets and supported blockchain applications outside those trading hours.
Payward has said the framework is intended to let tokenized assets move through centralized exchanges, self-custody environments and onchain financial applications while remaining backed by their underlying securities.
Its international expansion has accelerated during 2026. The GTN partnership established plans to add securities from several major equity markets, while Kraken’s EEA launch paired thousands of conventional U.S. shares with hundreds of xStocks within the same regulated account.
The London Stock Exchange partnership would extend that model to some of the largest publicly listed companies in the U.K. and could eventually allow the tokens themselves to trade through LSE 24 if regulators approve the plan.
Industry participants have meanwhile been working on using tokenized securities for functions beyond direct trading, including collateral and credit markets. Kraken’s July collateral rollout is one example of tokenized shares being used to support other financial positions without requiring investors to first sell the underlying exposure.
Payward and the LSE have not provided a specific launch date for the first U.K.-listed xStocks beyond saying they will become available over the coming weeks.
The companies have similarly not given a timetable for natively issued LSE equity tokens, with that part of the agreement remaining an area they plan to explore.
London Stock Exchange Group shares fell roughly 2% in early London trading Tuesday.
