FCA and Bank of England unveil joint vision for UK wholesale tokenisation

The Bank of England and the Financial Conduct Authority (FCA) have unveiled a collaborative vision regarding tokenisation in the UK wholesale markets, inviting industry input by 3 July 2026. Tokenisation, which involves creating digital forms of assets such as shares and bonds on a distributed ledger, has the potential to enhance efficiency, reduce costs, and simplify issuance, trading, and settlement processes. Key areas highlighted for clarification include prudential treatment, tokenised collateral, and settlement instruments. Simon Walls from the FCA emphasized the initiative's goal to inspire innovation among firms, while Sarah Breeden from the Bank of England urged a transition from pilot projects to full-scale implementation. Additionally, the Bank is exploring extending RTGS and CHAPS settlement hours to nearly 24/7, and the Prudential Regulation Authority (PRA) has released updated guidance on tokenised assets and stablecoins. The FCA is also reviewing client asset (CASS) regulations and has issued a policy statement on fund tokenisation. Furthermore, the Bank and FCA are collaborating with 16 firms through the Digital Securities Sandbox, with plans for a live synchronisation service by 2028, supporting HM Treasury's pilot digital gilt instrument (DIGIT).