How Tokenised Shares Could Redefine Market Access
The London Stock Exchange (LSE) and crypto‑exchange operator Payward have announced a joint venture to create digital tokens representing up to one hundred of Britain’s most actively traded equities. The initiative, unveiled on 2 September 2026, seeks to place these tokenised shares on a public blockchain, enabling investors to buy, sell and settle them around the clock, beyond the traditional market hours.
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Tokenisation turns a conventional share into a digital asset that can be transferred on a public ledger. Investors would hold these tokens in compatible wallets, eliminating the need for custodial intermediaries. The LSE expects the model to open up fractional ownership, allowing participants to purchase as little as a hundredth of a share, thereby lowering the entry barrier for retail traders.
Will 24/7 Trading Disrupt Traditional Market Hours?
„By marrying the depth of the UK equity market with the speed of blockchain, we are creating a new frontier for capital formation,” said a senior LSE spokesperson. Payward’s chief technology officer added that the system will employ a proof‑of‑authority consensus, ensuring that only authorised nodes validate transactions, which addresses concerns over decentralisation versus regulatory oversight. Early simulations suggest that settlement could occur within minutes, compared with the current T+2 framework.
The prospect of continuous trading raises questions about market stability and price discovery. Critics argue that around‑the‑clock trading could amplify volatility, especially during periods of low liquidity. Proponents counter that extended hours provide more opportunities for global investors to react to news in real time, potentially smoothing price swings.
Regulators are monitoring the pilot closely, emphasizing that tokenised securities must still comply with the UK’s Market Abuse Regulation and anti‑money‑laundering rules. The LSE has pledged to maintain rigorous reporting standards, ensuring that token trades are reflected in official market data feeds. If successful, the model could inspire similar projects in other jurisdictions, prompting a shift toward hybrid trading ecosystems that blend legacy exchanges with decentralized platforms.
Frequently Asked Questions
What is the timeline for the tokenised share rollout? The pilot is slated to launch in Q1 2027 with a limited set of ten stocks, expanding to the full hundred‑stock lineup by the end of 2028 if regulatory approvals are secured.
How will investor protection be handled? All token transactions will be subject to the same disclosure and investor‑protection rules as traditional shares, with the LSE overseeing compliance and Payward providing secure custodial solutions.
Can existing shareholders convert their holdings into tokens? Initially, only new purchases will be tokenised. A conversion mechanism for existing shares is under discussion and may be introduced once the platform demonstrates operational stability.