The Bank of England has pledged five measures to support digital asset innovation as it seeks to move tokenisation from pilot projects to mainstream financial markets.
Speaking at a Hogan Lovells event, Sasha Mills, executive director for financial market infrastructure at the Bank of England (pictured), said the UK must focus on turning digital asset experiments into trusted, commercially viable markets.
“The new horizon is not a financial system in which everything is tokenised,” she said. “It is one in which innovations that offer real value can move from possibility to practical use, and from practical use to lasting scale.”
Mills outlined five commitments from the Bank including maintaining a technology-neutral approach to regulation, supporting experimentation and growth, improving regulatory processes, helping coordinate industry collaboration, and working with overseas authorities to reduce cross-border fragmentation.
She said financial stability would remain the Bank’s priority but argued that responsible innovation could improve efficiency, resilience and economic growth. The Bank also intends to launch a live synchronisation capability in 2028, allowing digital asset platforms to settle transactions using central bank money.
Mills highlighted the Digital Securities Sandbox as a key mechanism for testing new market structures and tokenised securities under real-world conditions. The programme allows firms to issue, trade and settle digital securities while operating within regulatory safeguards.
She also pointed to the proposed Digital Gilt Instrument, or DIGIT, which could help firms test digital issuance, trading, settlement and collateral arrangements using a government bond.
The speech comes as UK authorities step up efforts to position the country as a leading centre for wholesale market tokenisation. In May, the Financial Conduct Authority and Bank of England launched a joint initiative aimed at providing greater clarity around tokenised assets and digital market infrastructure. Industry feedback will inform a formal tokenisation roadmap due later this year.
Market interest continues to grow. Citigroup has forecast that tokenised assets could reach $5.5 trillion globally by 2030, while earlier research from Boston Consulting Group suggested the market could exceed $16 trillion by the end of the decade.
