The new platform, called Digital Markets Infrastructure (DMI), was developed in collaboration with Microsoft and runs on Microsoft Azure.
The London Stock Exchange Group (LSEG) has launched a blockchain-based infrastructure platform for private funds, marking a significant step into digital asset markets by one of the world's most established exchange operators.
Key Takeaways:
The new platform, called Digital Markets Infrastructure (DMI), was developed in collaboration with Microsoft and runs on Microsoft Azure, according to a Monday announcement.
It supports the full lifecycle of digital assets, from issuance and tokenization to post-trade settlement, and is designed to bridge traditional capital markets with blockchain networks.
LSEG's first deployment of the platform saw capital management firm MembersCap raise funds for its tokenized MCM Fund 1, with Archax, a Financial Conduct Authority-regulated digital exchange in London, acting as nominee.
The transaction marked the first real-world use of the infrastructure, which the exchange says will soon support more asset classes beyond private funds.
Initially focused on private markets, the platform allows general partners and professional investors to discover and interact with fund opportunities through LSEG's Workspace system.
The exchange believes tokenization could help unlock access to private investments that have historically been opaque and illiquid.
"Today's private market processes are ripe for innovation," said Darko Hajdukovic, LSEG's Head of Digital Markets Infrastructure.
"There's a growing appetite for an end-to-end, interoperable, regulated financial markets DLT infrastructure."
Tokenization, which refers to the process of turning real-world financial assets into blockchain-based tokens, is gaining momentum among banks, asset managers, and infrastructure providers.
Proponents argue it offers faster settlement, broader investor access via fractional ownership, and improved transparency.
However, the market is still in its early stages, with tokenized assets representing a fraction of the trillions managed in traditional funds.
Microsoft's Bill Borden, VP of Worldwide Financial Services, said the collaboration "reshapes the future of global finance," citing the potential to unlock new client opportunities.
Archax and MembersCap are among the first to pilot the platform, alongside the Cardano Foundation.