LSEG Partners with Kraken Owner Payward on Tokenized UK Shares
London Stock Exchange Group (LSEG) is expanding its presence in the cryptocurrency market through a partnership with Payward, the parent company of exchange Kraken. As part of this initiative, LSEG plans to launch tokenized UK shares that can be traded alongside cryptocurrencies.
The move is seen as a significant step in LSEG's push into crypto and follows its announcement in February to build a blockchain-based settlement service. The new initiative will allow products linked to UK-listed shares to be represented as blockchain-based tokens, which can be sold to traders accustomed to trading cryptocurrencies.
LSEG has been under pressure from activist investor Elliott Management, which disclosed a stake in February and triggered a 20% rise in LSEG's share price. However, the company's shares remain 28% below their peak in February 2025.
Tokenization, a process that enables 24/7 trading and near-instant settlement, has the potential to transform stock markets by boosting liquidity and lowering costs. However, regulators have raised concerns about tokenized stocks creating new investor risks and undermining market integrity.