UK Finance Launches Tokenized Sterling Pilot with Six Major Banks

UK Finance Launches Tokenized Sterling Pilot with Six Major Banks

Digital Pound Initiative Targets Payments and Settlement Efficiency

UK Finance has unveiled a pilot for tokenized sterling deposits (GBTD) in partnership with six of the country’s largest banks — Barclays, HSBC, Lloyds Banking Group, NatWest, Nationwide, and Santander.

The trade association, which represents more than 300 financial services firms, said the project will test the use of tokenized commercial bank money as a digital representation of the British pound. The pilot will run until mid-2026 and is designed to explore faster payments, improved fraud prevention, and more efficient settlement processes.

Quant Network Provides Core Infrastructure

The project’s infrastructure will be powered by Quant Network, a UK-based blockchain interoperability platform. Quant previously delivered the first phase of the Regulated Liability Network (RLN), a UK-led initiative to develop shared ledger-based financial market infrastructure.

The RLN, launched in 2024, included not only the six banks now in the GBTD pilot but also global players such as Citi, Mastercard, Standard Chartered, Virgin Money, and Visa.

Quant CEO Gilbert Verdian said the initiative is about more than payment improvements:
“This is about enabling programmable money that will fundamentally transform how value is moved and managed.”

Testing Three Core Use Cases

The GBTD pilot will focus on three applications:

• Online marketplace payments

• Remortgaging processes

• Wholesale bond settlement

By embedding tokenized deposits in real-world use cases, the project aims to demonstrate both customer-facing benefits and systemic advantages for the wider economy.

FCA Regulation Expected by 2026

The launch comes as the Financial Conduct Authority (FCA) finalizes the UK’s crypto regulatory framework, with full implementation expected in 2026.

In April 2025, the Treasury issued a policy note outlining a “Future financial services regulatory regime for crypto assets.” The paper clarified distinctions between stablecoins, tokenized deposits, and electronic money.

According to the Financial Times, the FCA has also accelerated crypto approvals following criticism of slow processes, as the UK positions itself ahead of the EU’s Markets in Crypto-Assets (MiCA) framework.

Unlike MiCA, which regulates tokenization across crypto-assets, tokenized deposits remain under traditional banking rules.