The London Stock Exchange (LSEG) is making strides towards developing a new digital marketplace using blockchain technology. Murray Roos, head of capital markets at LSE Group, revealed that the decision to move forward with the initiative came after a year of internal discussions on the feasibility of a blockchain-enabled trading solution.
The LSE is considering the creation of a separate entity for the new venture and is currently engaging in discussions with the UK government and regulators. It is important to note that this initiative will not involve virtual currencies. Instead, it will focus solely on leveraging blockchain technology to enhance the purchasing, selling, and holding of traditional assets, making the process more seamless and transparent.
Roos stated, “The idea is to use digital technology to make a process that is slicker, smoother, cheaper, and more transparent…and to have it regulated.”
Governments and businesses worldwide have been exploring the potential of blockchain technology to streamline operations. However, it is crucial to consult with technical teams before adopting a blockchain/DLT framework. While blockchain development has become more streamlined in recent years, it is still important to consider whether it is suitable for a specific use case.
It is worth noting that not all blockchain-focused initiatives have been successful. Last year, the Australian Securities Exchange (ASX) had to cancel its plans to implement blockchain technology to modernize its clearing and settlements system. The decision came after an extensive review by tech consulting company Accenture, which highlighted significant challenges with the solution design and its ability to meet ASX’s requirements.
According to Accenture’s report, the business workflows were not tailored for a distributed environment, and the DLT-powered system was overly complex. The completion timeframe for the project also remained uncertain, despite the majority of the application software being complete.
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