LSEG plans blockchain-based trading – but steers clear of crypto

The London Stock Exchange Group is in talks to launch blockchain-based financial asset trading through a separate entity next year.

The company behind the London Stock Exchange has been exploring the potential of a blockchain-powered trading venue for around a year, the Financial Times reported.

Murray Roos, head of capital markets at the LSE Group, told the FT that the venture would not involve cryptocurrencies.

Instead, it would only use blockchain technology, with the goal of improving the efficiency of trading traditional assets.

“The idea is to use digital technology to make a process that is slicker, smoother, cheaper and more transparent … and to have it regulated,” Roos said.

Julia Hoggett, head of the London Stock Exchange, has been asked to lead the project, the report added.

The company is currently in talks with regulators in multiple jurisdictions and the UK Treasury over the blockchain marketplace plans.

The London Stock Exchange Group did not immediately respond to a UKTN request for comment.

If the launch goes ahead, it would be the first large global stock exchange to offer “end to end” blockchain-powered trading to investors, Roos said.

It comes as the London Stock Exchange looks to drum up activity in UK public markets. Activity has been slow this year for the LSE and AIM markets compared to a boom in 2021. According to EY data, there were just 18 issuers in the first half of 2023 – down 31% year on year.

In May, the London Stock Exchange said it was drawing up plans to launch a new stock market for private companies next year.