UK regulators outline roadmap for tokenisation and digital asset infrastructure in wholesale finance sector

UK regulators outline roadmap for tokenisation and digital asset infrastructure in wholesale finance sector

(IN BRIEF) Financial Conduct Authority and the Bank of England have outlined a joint strategy to support the adoption of tokenisation and distributed ledger technology in UK wholesale financial markets. The regulators said the technology could improve market efficiency, lower costs and modernize asset issuance and settlement systems. The initiative includes new consultations on regulation, infrastructure and prudential treatment of tokenised assets, as well as broader work on extending settlement hours and developing digital market infrastructure. The move forms part of the UK’s wider effort to strengthen its position in digital finance and next-generation financial market technologies.

(PRESS RELEASE) LONDON, 18-May-2026 — /EuropaWire/ — Financial Conduct Authority (FCA) and the Bank of England have set out a shared long-term vision for the use of tokenisation and distributed ledger technology (DLT) across UK wholesale financial markets, aiming to provide greater regulatory clarity and confidence for firms adopting digital asset infrastructure.

The two institutions said tokenisation — the creation of digital representations of real-world assets such as shares, bonds or currency on distributed ledgers — has the potential to improve the efficiency of wholesale financial markets by streamlining asset issuance, trading, settlement and management processes. The regulators believe the technology could support market resilience while lowering operational costs and enabling new financial services.

According to the FCA and the Bank, financial firms have been seeking greater certainty around regulation, settlement systems and infrastructure as tokenisation activity expands. In response, the regulators outlined their approach to areas including prudential treatment, tokenised collateral and settlement instruments, while also launching a broader discussion on future regulatory and infrastructure principles for digital wholesale markets.

Simon Walls, Executive Director of Markets at the Financial Conduct Authority, said tokenisation could reshape how assets are issued, traded and settled. He added that the FCA wants to support firms in using the technology to reduce risk, lower costs and develop new services, while maintaining the United Kingdom’s position as a leading global financial market.

Sarah Breeden, Deputy Governor for Financial Stability at the Bank of England, said regulators and industry participants now need to move from pilot programs toward broader production use cases that support both financial stability and sustainable economic growth.

As part of the initiative, the FCA and the Bank of England are requesting feedback from industry participants on whether existing regulatory frameworks and market infrastructure help or constrain the safe adoption of tokenisation technologies. Responses will contribute to the development of a joint roadmap for digital wholesale markets in the UK.

The announcement was accompanied by several related measures from UK financial authorities. The Prudential Regulation Authority (PRA) published updated guidance on the prudential treatment of tokenised assets, stablecoins and other cryptoasset exposures, while the Bank of England launched a consultation on extending RTGS and CHAPS settlement hours toward near-24/7 operations. The proposed staged expansion includes longer operating hours and weekend settlement services, subject to industry readiness and consultation outcomes.

The FCA also confirmed further work on how client asset rules (CASS) may evolve in response to tokenisation developments and industry feedback.

Additional initiatives highlighted in the announcement include continued collaboration with 16 firms participating in the Digital Securities Sandbox for live issuance and settlement of tokenised assets, plans for a live synchronisation service targeted for 2028, and support for HM Treasury’s pilot digital gilt instrument program known as DIGIT.

Media Contact:

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Email: press.office@fca.org.uk

SOURCE: The Financial Conduct Authority (FCA)