The London Stock Exchange Group has debuted its new blockchain infrastructure for private funds, completing its first tokenized fundraising.
While blockchain is the same technology that powers cryptocurrencies like Bitcoin, LSEG’s platform isn’t about these digital currencies themselves. Rather, DMI is about applying the technology to traditional finance. Unlike many other projects that digitize only part of the process, LSEG is offering the full range of the blockchain experience, including issuance, tokenization, and settlement.
“There are many processes in private markets today that can be improved,” said Head of DMI, Dr. Darko Hajdukovic. “At LSEG we are committed to significantly improving access to private markets, by streamlining workflows, enhancing distribution, and enabling liquidity.”
MembersCap, an investment manager, has become the first to use LSEG’s DMI, raising capital for its MCM Fund 1. The fundraising has been facilitated with Archax, a digital securities exchange regulated by the UK’s Financial Conduct Authority (FCA), acting as a nominee.
According to the press release, institutional alternative asset manager EJF Capital has also been onboarded as an early adopter, with some of its funds expected to become available on the platform soon.
Hjdukovic noted,
The onboarding of our first clients and this first transaction are significant milestones, demonstrating the appetite for an end-to-end, interoperable, regulated financial markets DLT infrastructure. LSEG’s position as a convener of markets can bring significant scale to digital assets and effect real change.
For now, DMI is only open to private funds, with LSEG planning for expansion into additional asset classes. The stock exchange said it will continue to collaborate with Microsoft to scale the blockchain platform.
“Together, we’re reshaping the future of global finance to empower our customers to unlock new opportunities and drive meaningful change,” said Bill Borden, Corporate Vice President at Microsoft’s Worldwide Financial Services.
Bitcoin recovered above $116,700 on Sunday, but the cryptocurrency has opened the week with a sharp pullback as it’s now back at $114,700. The chart below shows how the recent volatility in the coin’s price has looked.
