Feb 12 (Reuters) - LSEG said on Thursday it plans to build an on-chain settlement service for institutional investors called the LSEG Digital Securities Depository, which will connect traditional and digital securities markets.
This will enable trading and settlement of tokenised bonds, equities and private market assets across multiple blockchain networks, while remaining interoperable with existing settlement platforms, the London Stock Exchange operator said.
The move comes as LSEG faces pressure to improve performance from activist investor Elliott Management, which has built a stake in the company and is pushing for changes, after the company's shares fell more than 35% over the past year.
Its stock, which has been under pressure amid a broad selloff of global software stocks on AI concerns, were up 0.9% on Thursday.
LSEG, which operates a blockchain-based platform for private funds powered by Microsoft Azure, said the first deliverable under the system is planned for 2026, subject to regulatory approval.
The company said it will form a strategic partner group to include market feedback into the depository's build, aiming to create an ecosystem in which participants can easily move between digital and traditional markets, across time zones and with multiple payment options.
"As tokenisation continues to mature, interoperability between traditional and digital market infrastructure will be critical," said Angus Fletcher, global head of digital solutions at State Street.
Major British banks and financial institutions including Barclays, Lloyds, NatWest Markets, Standard Chartered and Brookfield have welcomed the latest move by LSEG.
Reuters provides news for LSEG's Workspace terminal and other products.
(Reporting by Raechel Thankam Job and Yadarisa Shabong in Bengaluru; Editing by Arun Koyyur)
