The London Stock Exchange (LSEG) has achieved a significant milestone by completing its first blockchain-powered transaction, signaling the debut of its new digital markets platform. As revealed in a recent announcement, the asset management firm MembersCap utilized this innovative system to secure funding for its latest private investment fund.
This transaction marks LSEG as the first major global stock exchange to implement an end-to-end blockchain system. The technology, termed Digital Markets Infrastructure (DMI), was developed in collaboration with Microsoft and efficiently managed the complete fundraising process, from initial issuance through to settlement.
Dr. Darko Hajdukovic, Head of Digital Markets Infrastructure at LSEG, emphasized the exchange’s commitment to enhancing access to private markets. He noted that the new platform aims to streamline workflows, improve distribution, and enable better liquidity in these private marketplaces. The concept of liquidity, which refers to the ease and speed with which an asset can be converted into cash without significantly affecting its market value, is crucial in this context.
The DMI operates on Microsoft Azure, further strengthening the existing partnership between the two entities, highlighted by Microsoft’s acquisition of a 4% stake in LSEG in 2022. This blockchain platform is intended to integrate with LSEG’s Workspace, a data and analytics platform, enabling transparency in fundraising activities for professional investors.
MembersCap, along with digital asset exchange Archax, were the first clients to be onboarded onto the new platform. In a noteworthy debut deal, Archax acted as a nominee for the Cardano Foundation, showcasing the operational capabilities of the DMI. While the current focus is on private funds, LSEG has plans to extend the platform to encompass various asset classes in the future.
In a broader context, LSEG has been actively exploring enhancements to its service. Reports indicate that the exchange is considering the introduction of 24-hour stock trading to address a growing demand from retail investors eager for trading opportunities beyond traditional hours. To facilitate this transition, the exchange is currently evaluating the technological and regulatory requirements necessary for implementing extended trading hours.
This strategic move aligns with similar efforts undertaken by major U.S. exchanges, including the New York Stock Exchange, Nasdaq, and Cboe Global Markets, which have sought approval from local regulators to allow for extended hours trading. As the financial landscape evolves, LSEG’s initiatives reflect a commitment to modernizing and responding to current market demands.
