LONDON, May 18, 2026 — The Financial Conduct Authority and the Bank of England on Monday set out a joint long-term vision for the use of tokenisation and distributed ledger technology in UK wholesale financial markets, outlining a coordinated regulatory and infrastructure approach aimed at supporting the transition from pilots toward production deployment.
In a joint statement and Call for Input published Monday, the authorities said financial firms require greater certainty around regulation, prudential treatment and market infrastructure as tokenisation adoption expands across wholesale finance. The regulators said the initiative is intended to support innovation while maintaining financial stability, market resilience and operational integrity.
Tokenisation refers to the digital representation of financial assets — including securities, deposits and other instruments — on distributed ledger infrastructure.
Shared regulatory framework for tokenised wholesale markets
The FCA and the Bank of England said they are seeking industry feedback on how existing regulation and infrastructure either support or constrain the development of tokenised wholesale markets in the United Kingdom.
According to the statement, the feedback process will inform future regulatory work and the development of a joint roadmap for digital wholesale market infrastructure.
“Tokenisation has the potential to transform wholesale markets — reshaping how assets are issued, traded and settled,” Simon Walls, executive director of markets at the FCA, said in the statement. He said the FCA aims to support firms seeking to adopt the technology to lower costs, reduce risks and develop new financial services.
Sarah Breeden, deputy governor for financial stability at the Bank of England, said UK authorities and market participants must now move “from pilots to production” following earlier experimentation involving tokenised financial instruments and distributed ledger infrastructure.
Settlement infrastructure and near-24/7 market operations
Alongside the joint announcement, the Bank of England published a consultation on extending operating hours for the UK’s RTGS and CHAPS settlement systems, outlining a staged approach toward near-24/7 settlement operations.
The consultation outlines a staged approach that could include weekend and extended daily operating hours, subject to consultation feedback and industry readiness. According to the Bank, the initiative is intended to support cross-border payments and emerging payment and settlement models as tokenisation develops within wholesale finance.
Prudential treatment of tokenised assets and stablecoins
The Prudential Regulation Authority also issued updated Dear CEO guidance letters addressing the prudential treatment of tokenised asset exposures, stablecoins and innovations involving deposits and e-money.
The guidance reflects recent market developments and reiterates supervisory expectations relating to risk management, governance and regulatory compliance, according to the statement.
Transition from sandbox testing to production deployment
The FCA and the Bank said they continue to work with 16 firms participating in the UK’s Digital Securities Sandbox involving the live issuance and settlement of tokenised assets.
The FCA also said it will continue considering how its approach to client asset rules could evolve in response to industry feedback and developments in tokenised finance. The regulator recently published a policy statement related to fund tokenisation.
The Bank separately said it is committing to launch a live synchronisation service targeted for 2028 and is working to enable tokenised equivalents of eligible assets to be used as collateral both at central counterparties and in central bank operations.
Digital gilt infrastructure and tokenised collateral development
According to the statement, the Bank’s ongoing infrastructure work also supports HM Treasury’s pilot issuance of a digital gilt instrument known as DIGIT.
The authorities said feedback on the Call for Input will remain open until July 3, 2026, with a feedback statement expected to be published during the summer.
