UK Finance is running a pilot of tokenised sterling deposits with Barclays, HSBC, Lloyds Banking Group, NatWest, Nationwide and Santander. The tests run until mid-2026 to assess whether payment controls, fraud reduction and settlement improve for bank customers, online marketplaces and wholesale counterparties. UK Finance and the banks report the initiative as the Bank of England maintains a guarded stance.
A tokenised deposit is digital commercial bank money recorded on shared ledgers to enable payments and settlement, according to the pilot summary. The approach aims to explore faster digital handling while keeping money within the regulated banking system.
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The GBTD pilot covers three tasks: online marketplace payments that hold funds until agreed conditions are met, remortgages that update land records instantly, and bond trades that pay out tokenised customer money against digital assets, the project papers state.
Quant supplies the links and uses phase one of the Regulated Liability Network to support connectivity across the pilot, according to the documents.
EY checks the code and Linklaters checks the law to spot flaws in smart contracts and stop unauthorised issuance, the documents add.
The Bank of England keeps a guarded stance, with Governor Andrew Bailey warning that certain stablecoins may pull deposits away from banks and add systemic risk. The GBTD keeps the deposit inside the bank and is framed to fit the UK National Payments Vision under bank supervision, UK Finance and quoted remarks note.
Links to bond markets and a possible “tokenisation-as-a-service” model may cut steps and quicken settlement.
Smart contract bugs and rogue issuance remain; Linklaters and EY run checks to limit both.
By leaving the deposit inside the regulated bank, the scheme avoids pitfalls the Bank of England links to certain stablecoins, though uptake still relies on approval from regulators and users.
Deliverables and results due by mid-2026 will feed into the National Payments Vision and may shape UK rules and product plans for tokenised deposits, the pilot schedule states.
If successful, the pilot could provide a supervised path to fit new tokenisation tech within UK payments, with mid-2026 results guiding regulatory decisions and future product design.
