FCA Approves London Stock Exchange as First PISCES Operator, Enhancing Private Market Trading

What's Happening?

The Financial Conduct Authority (FCA) has approved the London Stock Exchange (LSE) to operate a Private Intermittent Securities and Capital Exchange System (PISCES) platform. This new type of private stock market aims to facilitate trading of shares in private companies on an intermittent basis. The PISCES platform is the world's first regulated private stock market, developed through collaboration between industry, government, and regulators. The approval marks a significant milestone in efforts to boost growth and unlock capital investment, providing greater investor access to growth companies. The platform will operate through a financial markets infrastructure sandbox, allowing the FCA to test its design before finalizing a permanent regime expected in 2030.

Why It's Important?

The approval of the PISCES platform represents a major innovation in capital markets, potentially transforming how private companies access funding and how investors engage with these markets. By providing a regulated environment for trading private company shares, the platform could enhance liquidity and transparency, attracting more investors and supporting economic growth. This development may lead to increased competition in the private equity space, offering new opportunities for businesses seeking capital and for investors looking for diverse investment options. The initiative aligns with broader efforts to strengthen capital markets and support economic development.

What's Next?

The PISCES platform will undergo testing through the FCA's financial markets infrastructure sandbox, with trading expected to occur through periodic auctions or limited windows of continuous trading. The legislative framework laid by the Treasury earlier this year sets the stage for the platform's operations, with a permanent regime anticipated by 2030. Stakeholders, including private companies and investors, will likely prepare to participate in this new market, while regulators continue to refine the platform's design and operational guidelines.