London Metal Exchange Explores Tokenizing Unwarranted Stocks

The London Metal Exchange is looking into issuing digital tokens backed by metal that sits in warehouses without warrants. Until now these holdings had no standard way to be used as collateral for loans.

The project is still in its early phase. The exchange plans to consult stakeholders and, if it proceeds, will allow the tokens to be held by a third party to support financing.

Hong Kong is watching closely: warehouses there were approved in January, and the city features in China’s five-year plan as an emerging digital commodities hub.

Other players have already moved ahead with gold tokenization — HSBC since 2023, followed by Tether’s XAUT and Paxos’ PAXG. Last year LME itself handled $21 trillion in trades.

Based on information from cryptonews.net