UK sets 12-month tokenization roadmap centered on digital gilt, repo and funds

The UK has moved its tokenization agenda into a more operational phase, with a Treasury-backed report laying out a 12-month delivery plan for wholesale digital markets and explicitly tying that plan to sovereign debt issuance, repo market plumbing and fund tokenization. Rather than presenting tokenization as a generic innovation theme, the report frames it as market infrastructure policy: if standards, liquidity and legal frameworks form elsewhere, the UK risks losing influence over the next generation of wholesale finance. That is a meaningful shift in tone. The immediate question is no longer whether distributed ledger technology has a place in capital markets, but how quickly regulated institutions can move from pilot activity to scalable live use cases without weakening core protections around settlement, market integrity and investor access.

The report was delivered by Christopher Woolard in his role as the UK’s Wholesale Digital Markets Champion, and it sits inside the government’s broader wholesale financial markets digital strategy. Its central message is that the UK should build toward open but regulated digital market infrastructure through a coordinated push involving government, regulators and private-sector firms. The delivery structure is concrete: a taskforce with nine action groups, plus an orchestrator layer designed to coordinate interoperability and execution across use cases. The first practical focus is an end-to-end repo transaction on blockchain rails, alongside priority work on fixed income, tokenized funds and uncleared over-the-counter derivatives. In other words, the roadmap is aimed at the actual machinery of capital markets rather than consumer-facing crypto activity.

One of the clearest signals in the package is the emphasis on DIGIT, the planned Digital Gilt Instrument pilot. The Champion’s report says the government should prioritize an initial DIGIT issuance no later than the first quarter of 2027, while HM Treasury’s earlier pilot update said the project is meant to test the full lifecycle of sovereign debt issuance on distributed ledger infrastructure, including on-chain settlement and over-the-counter transfers. That matters because sovereign issuance can anchor standards for the rest of the market. If the pilot reaches live secondary trading and interoperable settlement, it gives banks, dealers, custodians and buy-side firms a common reference point for collateral use, post-trade design and operational risk controls. The report also argues that tokenized collateral should become a priority, including eventual consideration of whether the Bank of England could accept DIGIT within the Sterling Monetary Framework.

The economic case in the report is ambitious but not abstract. It points to estimates that tokenized real-world assets could reach tens of trillions of dollars globally over the next decade and says the UK could capture up to £33 billion in additional annual economic output and £14 billion in annual tax revenue by 2035 if it secures a meaningful role in that market. Those figures are directional, not guaranteed outcomes, but they help explain why the roadmap spends so much time on speed, interoperability and competitive positioning. The report repeatedly describes tokenized markets as a network game: liquidity, standards and issuance concentration can migrate quickly once a few jurisdictions become default venues. For the UK, that makes execution risk just as important as policy intent.

The roadmap is also notable for being relatively pragmatic about public blockchain infrastructure. Instead of treating permissioned and permissionless systems as a strict either-or choice, the report leans toward hybrid models in which regulated access controls and compliance layers can sit on top of open networks when that design is appropriate. As an example, it points to BlackRock’s BUIDL money market fund, which issues tokenized fund interests on Ethereum while using a permissioned wrapper for onboarding and compliance. At the same time, the report is explicit about unresolved problems. It highlights settlement-finality risk on permissionless networks, noting that a transaction confirmed onchain can still, in theory, be affected by chain reorganizations in ways that conventional market infrastructure does not usually face. That makes legal calibration and technical safeguards central to any move beyond experimentation.

Another reason the roadmap carries weight is that it is not starting from zero. The UK already has the Digital Securities Sandbox, live regulatory work on cryptoasset and stablecoin frameworks, and a growing list of institutional pilots in tokenized collateral, deposits and digital fund infrastructure. The government’s digital strategy published last year argued that wholesale markets still rely on too many fragmented, manually intensive processes, while more recent official remarks have pushed the idea that tokenization should support both modernization and international competitiveness. The new report tries to connect those threads into a single market program: digitize issuance, improve settlement design, create clearer routes from sandbox activity to authorization, and ensure that domestic infrastructure is attractive enough that liquidity does not simply form offshore.

For RWA markets, that combination is the real story. The UK is not just endorsing tokenization in principle; it is trying to define which institutional building blocks need to exist for tokenized bonds, funds and collateral to operate as part of mainstream capital markets. That raises a higher bar for delivery. Market participants will now need evidence that DIGIT can trade, settle and interoperate in ways that justify production adoption, and regulators will need to show that rulemaking can keep pace with technical design choices. If the UK can turn its repo, gilt and fund workstreams into functioning market rails, it will have moved tokenization from a policy ambition into a tangible RWA market structure project. If it cannot, the roadmap will still have clarified where the bottlenecks are likely to appear first.