Initial emphasis is on tokenised securities such as bonds, equities, and fund units, with potential expansion to additional asset classes over time.

A separate Basel Committee review of banks’ crypto asset exposure standards began in late 2025, with updates expected later this year, while the PRA is planning a long‑term framework consultation no earlier than 2028.

The PRA issued updated guidance proposing tokenised financial instruments receive the same regulatory treatment as traditional ones when rights and risks are comparable, as interim guidance ahead of a broader 2028 prudential framework.

The Bank of England and the Financial Conduct Authority have jointly opened a consultation on tokenizing UK wholesale markets, seeking industry input on regulation, infrastructure, and market practices for tokenised assets and payments.

Regulators aim to use tokenisation to improve efficiency in fund management, broaden access to private markets, and support wider digital wholesale market development.

Expanded hours for settlement aim to bolster cross-border payments and new settlement models driven by tokenisation, with public feedback invited through July and a summer feedback statement planned.

Earlier in the year, the FCA published a policy statement outlining a framework for broader fund tokenisation adoption, including optional direct-to-fund dealing rules and guidance for maintaining unitholder registers on distributed ledger systems.

The consultation focuses on using distributed ledger technology to tokenise UK wholesale markets, inviting feedback on rules, standards, and interoperability for tokenised assets with a goal of facilitating smoother payments.

Industry reaction has been positive, with experts noting potential for new pools of capital and inclusion of participants who were previously unbrokered.

Authorities emphasise establishing clear standards to prevent fragmentation across ledger platforms, supporting a migration toward native digital securities in the UK and reinforcing Britain’s leadership in digital finance.

The consultation builds on the Digital Securities Sandbox, where firms test issuance, trading, and settlement of tokenised securities, with sixteen firms progressing toward live testing.

Target participants include banks, investment firms, asset managers, market infrastructure providers, trading venues, post-trade players, and fintechs developing tokenisation solutions.