The London Stock Exchange Group (LSEG) is looking into building a blockchain-based digital markets ecosystem to enable the trading of traditional financial assets, according to a report by the Financial Times.

The report quotes Murray Roos, head of capital markets at LSEG, as saying that the exchange had been examining the potential for a blockchain-powered trading venue for around a year and had reached an "inflection point".

The project will be spearheaded by London Stock Exchange Chief executive Officer Julia Hoggett.

Roos said in an FT interview that the exchange was “definitely not building anything around cryptoassets” but instead was looking at using blockchain technology, which underpins cryptocurrencies, to ultimately tokenise traditional stocks and bonds and improve the efficiency of buying, selling and holding 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," he said.

The new digital business will reportedly focus on private markets initially, before expanding to other assets.