UK FCA and Bank of England set out shared vision for tokenisation in wholesale markets
The Financial Conduct Authority (FCA) and the Bank of England (BoE) have launched a joint Call for Input outlining a 'shared vision' for tokenisation in UK wholesale financial markets. The initiative aims to provide regulatory and infrastructure clarity as distributed ledger technology moves from pilots to production. Key focus areas include prudential treatment, tokenised collateral, and settlement instruments. The announcement follows signals from the BoE indicating possible concessions on stablecoin rules, including a review of proposed reserve floor and retail holding caps. The central bank also confirmed plans for a live synchronisation service by 2028, extended RTGS and CHAPS settlement hours, and support for HM Treasury's digital gilt pilot (DIGIT). The Digital Securities Sandbox continues to work with 16 firms on live issuance and settlement of tokenised assets. The Prudential Regulation Authority has updated guidance on prudential treatment of tokenised assets, stablecoins, and crypto exposures. Coinbase's Head of Policy for Europe welcomed the vision, urging the BoE and FCA to embrace DeFi opportunities. The move reflects a broader trend of UK regulators clarifying rules to support innovation while maintaining financial stability.
Key facts
- FCA and BoE launch joint Call for Input on tokenisation in UK wholesale markets.
- Regulators seek to clarify prudential treatment, tokenised collateral, and settlement instruments.
- BoE targets 2028 for live synchronisation service and near 24/7 settlement hours.
- PRA updates guidance on prudential treatment of tokenised assets, stablecoins, and crypto exposures.
- Coinbase urges BoE and FCA to adopt ambitious DeFi approach for tokenisation.