The Financial Conduct Authority (FCA) and the Bank of England are asking firms operating in the UK's wholesale financial markets to provide views on the rules and infrastructure needed to support the adoption of tokenization and the use of distributed ledger technology in the UK.
UK Regulators Seek Wholesale Market Views on Tokenization
18 May 2026 - 12:26 CEST
This follows an FCA policy statement published in April which set out guidance on how fund managers can use distributed ledger technology within existing rules.
It also follows a call from crypto industry leaders for the UK government to move quickly to support the growth of the sector, or risk falling behind other jurisdictions.
The FCA defines tokenization as "the digital representation of assets and their ownership using distributed ledger technology", and presents it as a potentially significant development in how wholesale markets operate.
Benefits
The anticipated benefits centre on improving the efficiency of wholesale markets, making processes faster, more resilient and, in some cases, less costly. Initial focus is on tokenized securities, including bonds, equities and fund units, though regulators expect the scope to expand over time.
"UK markets have always embraced new technology," said Simon Walls, executive director of markets at the FCA. He added that the aim is to provide sufficient clarity for firms "to engage, invest and innovate with confidence".
Questions
The emphasis remains on stability. The regulators continue to frame tokenization within the context of existing standards, noting that "a well‑designed regulatory system is a positive differentiator for the UK."
They are, therefore, asking how the UK can capture the potential benefits of tokenization while maintaining market integrity, financial stability and investor protection.
More specifically, the paper seeks views on how tokenized securities should be issued, traded, settled and held, and how new digital infrastructure should interact with existing systems. It also asks how far current rules should be applied unchanged and where targeted adjustments may be needed.
Timeline
Responses are due by 3 Jul, and will feed into a joint roadmap for the development of tokenized markets in the UK. A feedback statement is expected "in the summer", though there is no timetable for the publication of the roadmap itself.
