The Financial Conduct Authority (FCA) and the Bank of England have set out a shared vision for tokenisation and are seeking industry views on the future of UK wholesale markets.
Responding to calls from the industry that firms need more certainty on regulation and infrastructure as tokenisation grows, the institutions have set out their approach in key areas where greater clarity is needed, including prudential treatment, tokenised collateral and settlement instruments.
They have also opened a discussion on key principles for regulation and infrastructure that could facilitate the development of tokenisation in wholesale markets.
Simon Walls, executive director of markets at the FCA, said: “Tokenisation has the potential to transform wholesale markets – reshaping how assets are issued, traded and settled. We want to support firms in adopting this technology to lower costs, reduce risk and unlock new services, and our partnership with the Bank of England will ensure a common approach across all parts of wholesale markets.
“Today we are setting out the principles of a shared long-term vision to give industry the clarity it needs to engage, invest and innovate with confidence. UK markets have always embraced new technology, and that will be central to ensuring the UK remains at the forefront of global wholesale markets.”
Sarah Breeden, deputy governor for financial stability at the Bank of England said: “The Bank and FCA have done a huge amount to enable the responsible adoption, of tokenisation in retail and wholesale finance in the UK, working with the government and the industry. The task now is for public and private sectors together to build on these strong foundations, moving from pilots to production to support financial stability and sustainable growth.”
The FCA and the Bank of England are calling for industry views on where the existing rules and infrastructure either support or constrain the safe use of this technology. The feedback window will close on 3 July 2026, with a feedback statement set to be published in the summer.
The FCA recently published new guidelines for asset managers on using distributed ledger technology (DLT) within the regulator’s existing rules.
