Lloyds, Archax and Canton Network Deliver Landmark Tokenised Gilt Transaction

Lloyds, Archax and Canton Network Deliver Landmark Tokenised Gilt Transaction

(IN BRIEF) Lloyds Banking Group has completed the first-ever purchase of a UK Gilt using Tokenised Deposits, working with Archax and the Canton Network. The transaction marks the first issuance of tokenised sterling deposits on a public blockchain and demonstrates how traditional banking assets can be integrated with regulated digital finance infrastructure. By enabling instant settlement, interoperability, and regulatory security, the initiative highlights the growing role of tokenisation in shaping the future of financial markets.

(PRESS RELEASE) LONDON, 7-Jan-2026 — /EuropaWire/ — Lloyds Banking Group has completed a globally pioneering digital finance transaction in partnership with Archax and the Canton Network, marking the first-ever purchase of a UK Gilt using Tokenised Deposits.

The transaction represents a major milestone for digital assets and traditional banking integration. For the first time in the UK, Tokenised Deposits were issued on a public blockchain, and globally, it marks the first issuance of tokenised sterling deposits. The achievement demonstrates how regulated digital money can be used seamlessly within blockchain-based financial markets while maintaining the safeguards of conventional banking.

In the transaction, Lloyds Bank PLC, via Lloyds Bank Corporate Markets, issued Tokenised Deposits directly onto the Canton Network, a blockchain designed specifically for regulated financial use cases. These digital deposits were then used to purchase a Tokenised Gilt from Archax. Following settlement, the underlying funds were transferred back into Archax’s standard Lloyds bank account, illustrating interoperability between blockchain infrastructure and traditional financial systems.

Unlike private ledgers, the Canton Network operates as a public blockchain while preserving confidentiality for participants, creating conditions for broader industry adoption. The successful execution highlights how tokenisation can transform conventional financial instruments by enabling real-time settlement, improved liquidity, and automated processes without compromising regulatory compliance.

The transaction comes at a time when the UK government is exploring the issuance of digital securities. By demonstrating how Gilts can be represented and traded in tokenised form, the initiative provides a practical blueprint for integrating established financial instruments into emerging digital ecosystems.

Enabling new capabilities for businesses

Tokenised Deposits offer businesses the ability to transact directly on blockchain networks while retaining key features of traditional deposits, including interest accrual and regulatory protections. This creates a bridge between digital asset innovation and established financial frameworks.

Key advantages include faster settlement, reduced counterparty risk, expanded access to tokenised and traditional securities using the same cash asset, automated execution through smart contracts, and enhanced transparency through distributed ledger records.

As part of the initiative, Lloyds also operated its own validator node on the Canton Network, contributing to transaction verification and network security while applying the same standards used for safeguarding customer cash deposits.

The transaction builds on earlier collaboration between Lloyds and Archax, including the previous use of tokenised money market fund units as collateral. Together, these initiatives underscore Lloyds’ ongoing commitment to advancing regulated digital finance and accelerating the adoption of tokenised real-world assets.

Surath Sengupta, Head of Transaction Banking Products at Lloyds, said the transaction offers a practical glimpse into the future of finance, where speed, transparency, and efficiency are enhanced without sacrificing the protections of traditional banking.

Graham Rodford, CEO and co-founder of Archax, said the successful use of tokenised deposits to complete a real-world transaction demonstrates how digital representations of assets can deliver tangible benefits for financial institutions and markets.

Notes

About Lloyds Banking Group

Lloyds Banking Group is the largest UK retail and commercial financial services provider with around 27 million customers and a presence in nearly every community. We are proud to support British businesses, with nearing one million UK businesses supported by our leading digital and relationship banking services.

Our main business activities include retail and commercial banking, general insurance and long-term savings, provided through well recognised brands including Lloyds, Halifax, Bank of Scotland and Scottish Widows.

Our purpose is Helping Britain Prosper. We have served Britain through our products and services for more than 320 years, across every community, and millions of households. Our success is interwoven with the UK’s prosperity, and we aim to help Britain prosper by operating as a responsible, sustainable and inclusive Group.

Media Contact:

Sam Boden
samuel.boden@lloydsbanking.com
07868 675 107

SOURCE: Lloyds Bank plc