The London Stock Exchange Group (LSEG) achieved a groundbreaking milestone on September 15, 2025, by introducing the world’s first blockchain platform managed by a major global exchange. Dubbed Digital Markets Infrastructure (DMI), this innovative system is primarily centered around private funds and successfully completed its inaugural transaction just hours after launch. This momentous development highlights a significant shift in the landscape of traditional finance, as LSEG became the first exchange to operationalize a system that manages real money and transactions using blockchain technology.
A key component of this new platform is its reliance on Microsoft Azure cloud services, which provides the necessary computational power and heightened security to support large-scale financial operations. This partnership enables LSEG to seamlessly integrate blockchain capabilities with existing banking systems. Bill Borden, part of Microsoft’s financial services team, emphasized the collaborative effort’s aim to “reshape the future of global finance.” The DMI platform is designed to manage the entire lifecycle of digital assets, from their creation to the settlement of trades.
Operating on a private blockchain network, DMI offers LSEG privileged control over access and security, distinguishing it from public blockchain networks like Bitcoin or Ethereum, where participation is open to all. The platform’s first transaction was performed by MembersCap, an investment firm based in Bermuda, which utilized DMI to generate capital for its tokenized reinsurance fund, identified as MCM Fund 1. The transaction was facilitated by Archax, a regulated crypto exchange located in London, acting on behalf of the Cardano Foundation. This pioneering activity showcased the operational capabilities of the platform, allowing fundraising to be conducted entirely through blockchain technology, thus streamlining processes and significantly reducing settlement times from days to mere minutes.
EJF Capital is among the early adopters of the DMI platform and plans to offer several funds through this innovative system, setting a potential trend for other investment firms to follow suit as the platform proves its effectiveness.
Historically, private funds have been hindered by outdated procedures reliant on extensive documentation, restricted investor access, and sluggish settlement timelines. LSEG’s DMI addresses these challenges by fully digitizing the investment process. Furthermore, DMI is integrated with LSEG’s Workspace platform, which enables fund managers to present their opportunities directly to professional investors, thereby enhancing transparency in a sector that has long been opaque.
Darko Hajdukovic, head of LSEG’s digital markets unit, described the launch as a “significant milestone,” noting the robust demand for a regulated blockchain framework capable of interlinking digital assets with traditional finance. Currently, the platform is tailored exclusively for institutional and professional investors, as retail investors are not yet permitted to access these tokenized funds, and secondary trading of tokens is restricted.
The launch of DMI is strategically timed amidst extraordinary growth in tokenized assets, which have surged by 380% over the past three years to reach a total value of $24 billion, according to industry reports. Standard Chartered forecasts that the tokenized asset market could balloon to $30 trillion by 2034, with major financial institutions like BlackRock and Franklin Templeton already introducing tokenized funds valued in the billions.
In the UK alone, the private fund market holds an estimated £1.2 trillion in potential assets. If a mere 5% of these funds transition to LSEG’s platform by 2028, approximately £60 billion worth of assets would be shifted onto blockchain technology, which could translate to an impressive annual reduction of £78 million in operating costs for the industry.
Larry Fink, CEO of BlackRock, has been vocal in his assertion that all financial assets will eventually be tokenized, a sentiment echoed by leading institutions such as JPMorgan and Goldman Sachs, who are also launching blockchain initiatives.
As LSEG enters this competitive arena, it is essential to note that it is not alone in its endeavors. Nasdaq has filed plans with U.S. regulators to facilitate the trading of tokenized stocks alongside traditional shares, with a possible launch by 2026. Other global exchanges are also developing similar solutions, indicating a transition from experimentation to mainstream adoption of blockchain technology within the financial sector.
LSEG has plans to extend the DMI platform beyond private funds to incorporate various asset classes in the future, although details regarding the next type of assets remain undisclosed.
The introduction of LSEG’s blockchain platform signifies more than just a technological advancement; it serves as a harbinger of profound changes in the operational dynamics of financial markets. By validating that blockchain can efficiently and securely transact real money, LSEG is paving the way for broader adoption of blockchain technologies across the financial sector, heralding a new era of efficiency and accessibility for institutional investors around the globe.
