Innovation in wholesale markets

Overview  

Wholesale financial markets are undergoing significant change. Digitalisation and new technologies are reshaping how assets are issued, traded and settled. 

Our objective is to support innovation in a way that promotes financial stability, maintains trust in market infrastructures and supports growth. This could improve efficiency, resilience and transparency, and allow for new forms of financial assets and services. 

Realising these benefits requires a co-ordinated, system‑wide approach because of the increasingly interconnected payment and settlement ecosystem.  

What is our aim and how will we deliver it? 

We want to see a dynamic and resilient multi-money, multi-asset, multi-currency ecosystem, where different forms of money, assets and technologies interact safely and seamlessly. 

We explained our strategy in our shared vision for tokenisation in UK wholesale markets. We set out the Bank and Financial Conduct Authority’s (FCA) shared vision for the role of tokenisation in the UK’s wholesale markets and how we will support its adoption and scaling.  

We are using three of our key responsibilities to enable this: 

• regulation and supervision 
• infrastructure provision 
• catalysing and coordinating action across the system 

To do this, we work closely with the FCA, HM Treasury (HMT), international partners and industry participants. Industry innovation and adoption is critical, so engagement with stakeholders is central to our approach. 

How can you get involved? 

Respond to our consultation paper on extending settlement hours by 10 August 2026. We encourage respondents to provide an organisation-wide position having consulted with affected areas. Please send any questions to RTGSRoadmap@bankofengland.co.uk. 

Regulation and supervision 

Our approach is to provide a clear and coherent framework that allows for the adoption of new technologies in a way that maintains trust and resilience. 

This includes clarifying how existing regulatory principles apply as technologies evolve and identifying where targeted adjustments may be needed to reflect changes in market structure and risk. Our objective is to give regulated firms the clarity they need to innovate, while safeguarding the continued strength and competitiveness of the UK’s markets. 

Issuance and settlement of digital securities 

We are using insights from the Digital Securities Sandbox (DSS) to shape any new permanent regulatory regime for securities settlement.   

Find out more about the Digital Securities Sandbox

Prudential treatment of tokenised assets

We are considering how existing capital and risk frameworks apply to new forms of assets, and where we may need clarification or refinement to make sure risks are appropriately captured as firms adopt tokenisation at scale.  

We are implementing the Basel Committee on Banking Supervision’s standards for the prudential treatment of cryptoassets in the PRA rulebook. This includes standards related to new technologies and innovations in wholesale markets. The PRA will consult on the final prudential framework (including for tokenised assets) once the Basel Committee has completed its targeted review of its prudential standard.  In the interim, the PRA has set out guidance through a Dear CEO letter. 

Stablecoins and new forms of digital money 

We are finalising our regime for sterling-denominated stablecoins that are widely used for payments and settlement in the UK. These will be jointly regulated by the Bank and the FCA. The regime is based on the principle of ‘same risk, same regulatory outcome’, and is designed to support the use of stablecoins alongside other forms of money within the future 'multi-currency' ecosystem. 

The PRA has also confirmed expectations on innovations in the use of deposits, e-money and stablecoins. We published a Dear CEO Letter confirming the conditions under which deposit-takers may innovate, including in exploring tokenised deposits.  

The DSS provides the opportunity to test the use of stablecoins for wholesale financial market use cases. We have announced that DSS participants will be able to use sterling and non-sterling denominated stablecoins that meet certain criteria to settle the cash leg for all or part of any securities settlement systems. 

Infrastructure provision  

We operate the UK’s real-time gross settlement (RTGS) service. RTGS is the infrastructure at the heart of the financial system, enabling the real-time transfer of payments between financial institutions settled in central bank money – the ultimate risk-free settlement asset. 

We are evolving RTGS to support the adoption of new technologies and maintain the highest standards of resilience. A key step was launching the renewed RTGS, RT2, in April 2025. RT2 was designed as an open platform for further change and innovation with a Future Roadmap of continuous change. Our priorities are: 

• synchronisation 
• extending RTGS/CHAPS settlement hours  
• widening access to wholesale settlement in central bank money  
• wholesale experimentation  

ISO 20022 messaging standard

A key enabler of RT2 supporting innovation is its migration to the ISO 20022 messaging standard. This global standard has been implemented in 77% of FPS and 53% of RTGS systems (forecast to rise to 81% by the end of 2028), supporting interoperability and harmonisation. As an open standard, the ISO 20022 messaging sets and fields can evolve and adapt to new technologies, such as synchronisation. Furthermore, the ISO 20022 payment messages introduce greater structure and new ‘enhanced data’ fields, which could allow product and service innovation, and improve insights and market intelligence. In response to industry feedback on realising these potential benefits, the Bank has mandated enhanced data in certain CHAPS payments.  

Synchronisation 

We are developing capabilities to enable interoperability between RTGS and external ledgers through a synchronisation service. This will allow atomic settlement in central bank money across a range of infrastructures including those based on distributed ledger technology (DLT). We are providing a Synchronisation Lab for industry to demonstrate use cases and understand business models, to support our commitment to launching a live service in 2028. 

• Find out more about synchronisation

Extending RTGS/CHAPS settlement hours 

We are extending settlement hours for RTGS and CHAPS, supporting a transition towards near 24/7 settlement. This will allow for new settlement models, enhance cross‑border payments, and improve liquidity and risk management across the system.  

Widening access to wholesale settlement in central bank money

We are exploring how broader access to wholesale settlement in central bank money can support innovation across the payments and financial markets ecosystem. Our access policy sets out a clear and transparent framework for providing RTGS settlement accounts and services to a range of institutions, including banks, payment service providers and financial market infrastructures. This includes Omnibus Accounts, which enable payment systems based on DLT to settle in central bank money. By allowing eligible participants to settle obligations in central bank money, the safest and most liquid form of sterling, this framework reduces settlement risk and supports resilience across payment systems. 

Wholesale experiments programme 

We conduct experiments to test how new technologies can be applied in practice to wholesale settlement. These experiments provide evidence on how innovation can be implemented safely and effectively, helping to inform future developments in both policy and infrastructure. 

• Find out more about our wholesale experiments programme

Data  

We use data and analytics to shape our approach to wholesale innovation. Using data from CHAPS, market developments, and industry engagement, we generate insights to inform our strategic priorities and policy framework. This evidence base supports the assessment of how emerging technologies, such as distributed ledger technology and tokenisation, may interact with existing infrastructure, and helps identify opportunities for future enhancements.  

Catalyse and co-ordinate action   

We work closely with domestic and international partners to ensure a coordinated and consistent approach to innovation across the financial system. Groups we work with include other UK authorities, standard setting bodies, and market participants to ensure alignment as new technologies develop.  

Wholesale market transformation

We work closely with the FCA, HMT, and HMT’s Wholesale Markets Digital Champion to deliver the ambitions of HMT’s wholesale financial markets digital strategy. Through working together, we ensure a co-ordinated approach to enabling the benefits of innovation to materialise across the financial markets. The Bank and the FCA published an initial Call for Input on the future of tokenisation in UK markets in May 2026.  

HMT’s Digital Gilt pilot 

The Digital Gilt Instrument (DIGIT) is a digitally native Government debt instrument, which will be issued on a platform within the DSS. This would be a real but experimentational issuance and is a demonstration of the UK authorities’ commitment to enabling the adoption of tokenisation in capital markets. We are committed to supporting the success of the DIGIT issuance through practical steps including; considering the eligibility of DIGIT as collateral in SMF operations, supporting issuance through the DSS, and working to help identify options for cash settlement. 

Enhancing cross-border payments 

The Bank is an active member of international standard setting bodies, including the Bank of International Settlements’ (BIS) Committee for Payments and Market Infrastructures (CPMI). The CPMI, along with the Financial Stability Board (FSB), plays a key role in delivering the G20's priority to make cross-border payments faster, cheaper, more accessible and more transparent. Innovation in wholesale markets can also improve efficiency, resilience and transparency of cross-border payments.