LSE Group goes blockchain for digital asset initiative

London Stock Exchange Group’s focus is on using crypto technology to improve traditional asset transactions, not on trading cryptoassets

article-image

Victor Moussa/Shutterstock, modified by Blockworks

share

The London Stock Exchange Group (LSEG) has reportedly developed plans for a new digital markets venture after exploring the idea for about a year.

This move is expected to make it the first big exchange to widely use blockchain for trading regular financial assets, according to LSEG.

Murray Roos, the group director of capital markets at LSEG, told the Financial Times that the company chose to advance the plans after considering the idea.

Julia Hoggett, serving as CEO of the London Stock Exchange since 2021, has been tasked with leading the project, according to the FT.

LSE Group is one of the top names among the stock exchanges of the world, as it is comparable to other big global players like NYSE Euronext, Nasdaq and CME Group.

Lately, the company has been looking into new tech like blockchain to improve the speed, efficiency and security of financial transactions.

Roos emphasized that the exchange’s focus is not on creating anything connected to cryptoassets. Instead, they aim to use the underlying technology that powers crypto to enhance the transaction process for traditional assets.

The plan, he said, is to use blockchain “to make a process that is slicker, smoother, cheaper and more transparent…and to have it regulated.” He noted that LSEG held off until it was confident that public blockchain technology was sufficiently robust and that investors were prepared.

The new digital venture isn’t aimed at competing with LSE’s traditional operations or boosting its struggling equities market. 

Planned as a separate legal entity, it could launch within a year, pending regulatory approval. 

Blockworks has reached out for comment on the matter.

LSEG has reportedly already discussed the project with various regulators, including the UK government and Treasury.

“The ultimate goal is a global platform that allows participants in all jurisdictions to be able to interact with people in other jurisdictions completely abiding by rules, laws and regulations, potentially multiple jurisdictions simultaneously, which is something that hasn’t been possible in an analogue world,” Roos told the outlet.

He mentioned a scenario where a Swiss buyer wants to purchase a Japanese asset from an American seller. 

Using older technology, this could be complicated, but it would become straightforward in a digital environment if LSE gains support from multiple regulators, he said.

At first, the digital venture will probably concentrate on private markets, where transactions are often slow.

After proving the model works there, the focus will broaden to include other types of assets.
Swift’s successful tests of tokenized asset transfers across multiple blockchains show that the technology is gaining traction even among larger institutions. This trend aligns with LSEG’s own plans to harness blockchain technology for its new digital markets venture.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Templates.png

Research

ZKPs enable efficient offchain transaction processing and validation, resulting in increased throughput and reduced fees. Solana's ZK Compression leverages ZKPs to minimize onchain storage costs, while Sui's zkLogin streamlines user onboarding by replacing complex key management with familiar OAuth credentials.

article-image

North Korea suspected in breach of Indian exchange’s multisig wallet

article-image

Plus, Sanctum’s CLOUD token has officially launched — but not without problems

article-image

It’s not yet clear whether Donald Trump is pumping bitcoin. But an unofficial memecoin is still seeing benefit.

article-image

StarkWare takes a step towards making StarkNet for Bitcoin

article-image

The numbers point to one conclusion: Risk is back, or at least it was during the first half of the year