Driving innovation and interoperability in global capital markets with Distributed Ledger Technology (DLT)
LSEG has launched Digital Markets Infrastructure (DMI), pioneering a new standard for capital markets innovation, built in partnership with Microsoft. DMI will provide trusted, scalable, and interoperable financial infrastructure to bring blockchain-powered efficiency to the full asset lifecycle: from issuance and tokenisation to settlement and post-trade servicing – across multiple asset classes.
DMI is the next frontier of what we have been doing for over 300 years – providing trusted, regulated, robust infrastructure to global markets, designed to enhance the evolution of our markets, not disrupt them.
At the heart of DMI are the principles of interoperability and scale. By leveraging emerging new technologies, we can drive innovation and efficiency in financial markets. True innovation, and the full potential of Distributed Ledger Technology (DLT), can only be realised by enabling seamless interoperability - not just within our own systems, but across other blockchain networks and, critically, established, and traditional financial infrastructure too. Our vision is, therefore, to partner with the industry, and provide frictionless connectivity across multiple digital platforms and legacy financial systems. This ensures participants can operate efficiently and securely, unlocking new value in both digital and traditional ecosystems - collaborating to facilitate seamless capital market transactions.
Why DLT? Why LSEG? Why now?
DLT delivers immediate distinct practical benefits in addressing real-world challenges within capital markets. DLT offers a transparent, immutable ledger, ensuring data integrity and auditability. This decentralised approach reduces settlement friction, mitigates counterparty risk, and fosters a resilient infrastructure that is adaptable to the rapid evolution of modern markets, driving efficiency across the financial sector.
Let me be clear, we are going to deliver the technology that solves problems, not technology that is looking for solutions. Which is why we remain open to collaboration and to listening, learning, and adapting. We do not seek from our clients to change their processes, and we want minimal, or ideally, no adoption costs. While there are good reasons, why we chose to operate DLT, there is no reason to ask for everyone else to have to work with it. Our job is to use DLT to deliver benefits to clients, not make them adopt new technologies.
We are going to deliver the technology that solves problems, not technology that is looking for solutions
Our vision extends beyond a single platform. The inclusive, interoperable design which we are proposing is critical. It ensures that participants can access the benefits of digital markets while preserving their connections to traditional systems, supporting both innovation and continuity as the industry evolves.
With interoperability also comes the concept of modularity. By this, we mean that although we are seeking to provide an end-to-end solution - from issuance to payments - we do not require everyone to use every component. We are not a closed system. Instead, if market participants already have some aspects of the system built - for example, a tokenisation factory - we will find ways to offer trading and settlement capabilities that integrate with their existing infrastructure. This is what true interoperability means: the ability to interact in real time with different market participants and systems, enabling scale and flexibility across the ecosystem.
The time for this evolution is now. DLT has progressed well beyond experimental stages.
We are no longer at an inflection point; leading organisations around the world have made tangible investments and consistently demonstrate DLT’s technology resilience.
There are clear, practical use cases where DLT is scaling, reinforcing its readiness for broader use. Given this growing maturity and the proven stability of the technology, we believe it is the opportune moment to start the process of considering DLT as core infrastructure for capital markets.
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Transforming the landscape of Private Funds – and beyond
DMI has been engineered from the ground up to support any asset class, in any geography. Its architecture is intentionally universal, capable of facilitating transactions and innovation whenever and wherever capital flows. Whether in equities, fixed income, digital assets, or emerging instruments, DMI is poised to connect and empower participants worldwide.
For our initial deployment, we have strategically chosen to apply these capabilities within private markets, with a focus on private funds. This includes closed-ended and interval vehicles over any underlying asset, spanning strategies from private equity and credit to real assets.
DMI will address several needs for General Partners (GPs) and Limited Partners (LPs), including:
- Enhanced Distribution: Leveraging LSEG’s leading Workspace terminals business, DMI provides GPs with access to a broad pool of LPs, while enabling thousands of potential investors (LPs) to discover private fund opportunities and in doing so tailor them to their specific portfolios.
- Secondary Market: Through a secure and trusted environment, LPs will be empowered to trade fund units, increasing liquidity and providing greater confidence to both LPs and general partners (GPs).
- Streamlined Information Access: DMI delivers timely, accurate information to all parties while upholding the highest standards of privacy and security - underpinned by LSEG’s proven infrastructure and market connections.
DMI sits alongside existing LSEG initiatives like our Private Securities Market (PSM), but operates distinctly - leveraging DLT and our regulatory licences to facilitate primary and soon also secondary transactions in private funds, whereas PSM makes use of bespoke regulation (PISCES), enabling the London Stock Exchange to run secondary auctions for private companies through its existing technology.
To deliver this vision, DMI is built in partnership with Microsoft, leveraging its enterprise-grade cloud infrastructure to ensure scalability, security, and resilience. This collaboration brings together LSEG’s market expertise and Microsoft’s technology leadership to support the next generation of digital financial infrastructure.
And it is just a start
This is only the beginning - DMI is designed to scale across asset classes and adapt to evolving industry needs. We are particularly excited about DMI’s potential for expansion, including the integration of AI to further streamline deal discovery and servicing.
In summary, LSEG’s Digital Market Infrastructure is more than just an innovation, it represents the next chapter in connecting market participants, fostering interoperability, and supporting the entire financial ecosystem with the most advanced, reliable technology available.
At the core of our proposition is the intention to collaborate - we can’t and don’t want to do it alone. We are delighted to invite market stakeholders, general partners, limited partners, service providers, innovators, and visionaries, to join us on this transformative journey. Now is the moment to shape the future of digital markets and of private markets together.