Bank of England and FCA Launch Public Consultation on Tokenization of Wholesale Financial Markets

BlockBeats News, May 18th—The UK Financial Conduct Authority (FCA) and the Bank of England (BOE) jointly launched a public consultation on Monday, seeking industry feedback on the regulation of the UK tokenized wholesale financial market, infrastructure, and market practices.

This consultation is part of the UK's Digital Finance Market Strategy, focusing on tokenized securities and post-trade infrastructure, covering aspects such as prudential regulation, tokenized collateral, and settlement tools. Regulatory authorities stated that there are significant opportunities for tokenization in post-trade processes and collateral management.

The consultation targets banks, investment firms, asset management companies, central securities depositories (CSDs), central counterparties (CCPs), trading platforms, fintech firms, and others. The current scope mainly involves tokenized bonds, stocks, and fund shares, with the possibility of further expansion in the future.

Market participants can submit feedback by July 3rd. The FCA and the Bank of England plan to release a feedback paper in the summer of 2026 and roll out a digital wholesale market development roadmap within the year.

Meanwhile, UK regulatory authorities are advancing the "Digital Securities Sandbox" initiative, with 16 companies currently passing the initial phase review and testing the issuance, trading, and settlement of tokenized securities.

Furthermore, the Bank of England separately released a consultation paper on extending the operating hours of the RTGS and CHAPS systems, aiming to gradually move towards a nearly 24/7 operating mode. The target is to introduce synchronized settlement services by 2028 to support tokenized assets for central bank operations and central counterparty collateral use.