London Stock Exchange Group(LSEG) to Launch Blockchain Platform for Private Funds

TLDR

• LSEG debuts blockchain-powered DMI to transform private fund markets.
• Digital Markets Infrastructure by LSEG streamlines private fund lifecycle.
• LSEG pioneers regulated blockchain system for private fund tokenisation.
• Private funds go digital as LSEG launches DMI on Microsoft Azure.
• Blockchain meets finance: LSEG’s DMI reshapes private fund operations.

The London Stock Exchange Group (LSEG) has introduced a blockchain-based platform designed specifically for private funds. The platform, named Digital Markets Infrastructure (DMI), aims to support the complete lifecycle of digital assets. This launch makes LSEG the first global exchange operator to implement such a regulated system at scale.

LSEG Targets Private Fund Market with Digital Asset Solution

LSEG developed the DMI platform in partnership with Microsoft and hosted it securely on Microsoft Azure cloud services. This infrastructure enables private funds to manage issuance, tokenisation, and settlement within a unified, blockchain-based framework. Moreover, DMI seamlessly integrates with LSEG’s Workspace system, expanding digital access for professional market participants.

The initial rollout focuses on private funds, offering tools to streamline operations in a fragmented market. Through tokenisation, the platform aims to enhance transparency and reduce friction in capital raising and fund distribution. Early adopters, including MembersCap and Archax, have already conducted transactions using the new infrastructure.

Interoperability Key to Blending Traditional and Digital Assets

The DMI platform promotes interoperability between blockchain technology and existing financial systems. LSEG designed the solution to work within current regulatory frameworks, providing stability and compliance assurances. This dual compatibility enables broader adoption without requiring financial firms to abandon traditional tools.

By incorporating blockchain into private funds, the exchange is addressing inefficiencies in asset discovery and post-trade processes. This initiative reflects a growing trend of traditional institutions adopting distributed ledger technology. The platform is expected to expand to other asset classes over time, supporting both digital and traditional financial instruments.

Tokenized private funds benefit from faster settlement, improved access, and operational efficiency. LSEG’s move aligns with similar efforts by market leaders to embrace decentralised infrastructure while preserving regulatory oversight. The group views this as a way to scale digital asset markets while maintaining institutional trust.

Industry Adoption Accelerates Amid Push Toward Tokenisation

MembersCap launched its MCM Fund 1 through the DMI platform, with Archax acting as the regulated nominee exchange. EJF Capital also joined as an early adopter, with several of its private funds scheduled for integration. The collaboration highlights a shift from experimentation to production-ready tokenisation systems.

Financial institutions worldwide are exploring real-world asset tokenisation to unlock broader access and liquidity. Analysts forecast that the tokenised private funds market could reach trillions by the next decade. Other exchanges like Nasdaq are preparing for similar transitions in public securities trading.

 

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