Payward, the parent company of crypto exchange Kraken, announced a landmark partnership with the London Stock Exchange to tokenize the 100 largest companies listed on the LSE as part of its xStocks framework.
The deal marks one of the most significant steps yet in bringing a major traditional equity market onto blockchain infrastructure. The first London-listed xStocks are expected to be available in the coming weeks on Kraken and other platforms participating in the xStocks Alliance. The tokens will be 1:1-backed representations of the underlying shares and available to investors in more than 110 countries, though not currently to UK-based retail investors.
LSE 24 and Native Equity Tokens
Subject to regulatory approval, the LSE plans to list and support trading of the xStocks on LSE 24, its recently announced extended-hours venue. LSE 24 will operate Monday through Friday from 5 p.m. to 7:50 a.m., with a 30-minute pause for end-of-day processing, according to The Block. The venue is designed to capture overnight demand from investors in Asia and other time zones who want access to UK equities outside normal London trading hours.
The partnership extends beyond simply tokenizing existing shares. Payward and the LSE will explore native equity tokens issued through LSE infrastructure, with the same rights and full fungibility as traditional shares. This could eventually allow companies to issue stock directly on blockchain rails rather than converting existing paper-based shares into tokens after the fact, a fundamentally different approach to how securities are created and distributed to investors worldwide.
By working with Payward, and continuing to collaborate across the market infrastructure ecosystem, we are exploring how issuers and investors can benefit from new forms of access while maintaining the standards that underpin public markets, LSE CEO Julia Hoggett said in the announcement.
xStocks Framework Expands Globally
The move marks the latest international expansion for Payward tokenized equities framework. Launched in June 2025 and acquired by Payward in December of that year, xStocks has processed over $40 billion in total volume across more than 200,000 holders, with nearly $20 billion settled onchain, according to the company. Those figures make xStocks one of the most actively used tokenized equity platforms in the world today, with volume growing rapidly since the platform first launched last year.
In July, Payward partnered with GTN to expand xStocks into Hong Kong, the UK, Europe, and South Korea across GTN execution and custody network spanning more than 90 markets. Kraken also launched U.S. stock trading alongside xStocks for European Economic Area customers in August through its Cyprus-regulated entity, marking the first time a major crypto exchange offered both tokenized and traditional equities side by side on the same platform.
There is roughly $2.53 billion worth of tokenized equities in existence, according to RWA.xyz data. About $606.6 million of that total has been tokenized by xStocks, making it the second-largest issuer after Ondo, which has approximately $840.4 million tokenized. The combined market represents a tiny fraction of global equity trading volume, but the growth trajectory has been steep over the past year as institutional interest accelerates rapidly.
Traditional Exchanges Embrace Tokenization
The Payward-LSE partnership is part of a broader trend of traditional financial institutions moving toward blockchain-based infrastructure for securities. In March, Nasdaq announced its own partnership with Payward to integrate xStocks into its institutional infrastructure, enabling clients to move securities from traditional trading systems onto blockchain networks. That deal signaled that even the world second-largest stock exchange sees tokenization as a long-term structural shift rather than a passing trend.
Several fintech platforms have also begun offering tokenized stocks in European markets. Companies including Robinhood, Gemini, and Kraken have launched tokenized equity products, while Coinbase and blockchain startup Dinari are pursuing approval to offer similar products in the United States. The regulatory environment varies significantly across jurisdictions, with European markets generally moving faster to accommodate tokenized securities under MiFID II frameworks.
Payward reported second-quarter adjusted revenue of $508 million, up 17 percent year-over-year, while total platform transaction volume reached $310 billion. The strong financial performance gives the company significant resources to continue expanding its tokenization infrastructure across global markets and deepen partnerships with regulated exchanges like the London Stock Exchange.
Regulatory Hurdles Remain
The full vision of native on-chain equity issuance through the LSE requires regulatory clarity from the UK Financial Conduct Authority. While the FCA has signaled openness to blockchain-based financial innovation, the specific approval process for tokenized securities on a major regulated exchange is still being developed. The FCA has confirmed that a new FSMA-based cryptoasset regime will have an application window from September 30, 2026 to February 28, 2027, with commencement set for October 25, 2027.
The xStocks tokens themselves are not currently available to UK-based investors, a restriction that may ease as the regulatory framework matures. The broader offering will span tokenized equities from the U.S., Europe, the UK, and Hong Kong, alongside other asset classes, for LSE members using the venue.
The partnership represents one of the most concrete steps yet toward a future where traditional stock exchanges and blockchain-native trading infrastructure operate side by side, potentially offering investors around-the-clock access to equity markets that have historically been limited to fixed trading hours. Whether the LSE can navigate the regulatory landscape quickly enough to capture first-mover advantage in tokenized UK equities remains to be seen, but the signal from one of the world oldest stock exchanges is unmistakably clear.
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