United Kingdom To Bring Stocks Onchain

The London Stock Exchange is collaborating with cryptocurrency exchange Kraken to tokenize shares of the UK's top publicly traded companies. Starting next month, the 100 largest London-listed firms will become available in Kraken's xStocks tokenized equities framework. Tokenized stocks are digital tokens on a blockchain that represent traditional company shares. These tokenized equities can be traded around the clock using self-custody wallets, unlike conventional stocks that trade during specific hours.

The tokenized stocks will have a one-to-one backing of the underlying shares, allowing investors to trade them anytime. London is among several exchanges exploring equities tokenization, aiming to provide greater liquidity and flexibility compared to traditional equities. The xStocks platform has already garnered significant interest, with over $40 billion U.S. in total trading volume.

While the plan for tokenized equities awaits regulatory approval, LSEG remains optimistic about its implementation. The exchange is hopeful about proceeding with its strategy following regulatory clearance. However, investors are also considering potential uses for tokenized assets, such as collateral, a topic still under debate. Currently, LSEG stock has seen a 4% decline over the past year in London trading.