UK Plans to Capture £33B From Tokenized Finance by 2035
A UK government-backed task force of 50 firms has set a 12-month tokenization roadmap targeting a digital gilt by Q1 2027 and £33 billion in annual GDP uplift by 2035.
Quick Insights
- A government-backed report from Wholesale Digital Markets Champion Chris Woolard sets a 12-month plan to move UK tokenized markets from isolated pilots into live repo, collateral and settlement activity, with a digital gilt targeted for the first quarter of 2027.
- A companion Barclays and PwC analysis estimates tokenization could add up to £33 billion ($44 billion) to UK annual GDP by 2035, with two thirds of that benefit flowing beyond the financial sector into the wider economy.
- The industry task force behind the roadmap includes more than 50 institutions spanning BlackRock, Goldman Sachs, JPMorgan, Morgan Stanley, HSBC, Coinbase, Circle, Ripple, Kraken, DTCC and Euroclear, making it one of the broadest public-private tokenization coalitions assembled in any jurisdiction.
The UK government published its most comprehensive tokenization roadmap to date on Monday, backed by a 50-institution task force and an economic analysis projecting that a leadership position in digital securities could deliver up to £33 billion in annual GDP by 2035. The first report from Wholesale Digital Markets Champion Chris Woolard, commissioned by HM Treasury, sets a 12-month plan designed to move the UK's tokenization programme beyond controlled experiments and into live financial markets where securities can be traded, settled and used as collateral. A companion report by Barclays and PwC, published alongside the Woolard roadmap, provides the economic modelling behind the headline figure and warns that the window for the UK to lock in its competitive position is narrowing as other financial centres move faster.
The Barclays and PwC analysis puts the total UK assets under management at £14.3 trillion, the majority sitting in asset classes that are already being tokenized elsewhere. The report argues this gives the UK a structural advantage that is time-limited rather than durable. Tokenization markets are already forming around jurisdictions that have established clear policies and practical pathways, and without coordinated action the UK risks watching liquidity concentrate in competing centres from which it may be difficult to recover market share.
A Digital Gilt by Q1 2027 and Live Repo Testing Within 12 Months
The Woolard report's 12-month plan has two primary near-term deliverables. The first is a live test of tokenized securities in a repo transaction, where securities are used as collateral to borrow cash, within the coming year. The second is the issuance of the UK's first digital government bond, referred to as DIGIT, by the first quarter of 2027. The Digital Gilt Instrument pilot was first announced in November 2024, with HSBC's Orion platform appointed to support it in February this year. The new report adds a timetable and expands the intended role of the instrument significantly: beyond a single issuance, it calls for subsequent offerings, live secondary-market trading and eligibility for use as central bank collateral.
That last point is critical. The report argues explicitly that tokenized securities have limited value unless they can be traded or used to raise cash, and urges the Bank of England to accept digital gilts in its own operations. A digital gilt that cannot be used as collateral at the central bank or in private repo markets is, in practice, a demonstration rather than a working financial instrument.
"Onchain funds, bonds and repo aren't experiments. They are already proving cheaper, better and faster than their legacy equivalents."
Sixteen Firms Including Euroclear and HSBC Preparing to Launch Through the Digital Securities Sandbox
The UK already has live infrastructure that could support these ambitions. The Digital Securities Sandbox, operated jointly by the Bank of England and the FCA since 2024 and running until January 2029, allows firms to stand up genuine trading venues and settlement systems for tokenized securities inside a real regulatory perimeter. Sixteen firms are now preparing to launch through it from late 2026, including Euroclear, HSBC and the London Stock Exchange Group, names that signal serious institutional commitment rather than exploratory activity. The Bank of England has also committed to launching a live synchronisation service targeted for 2028 and is working to enable tokenized equivalents of eligible assets to be used as collateral in its own central bank operations.
- Traditional finance: BlackRock, Goldman Sachs, JPMorgan, Morgan Stanley, HSBC, UBS, Barclays, Deutsche Bank, DTCC, Euroclear
- Crypto and digital assets: Coinbase, Circle, Ripple, Kraken
- Infrastructure and settlement: Fnality, the London Stock Exchange Group
- Total task force: more than 50 institutions across traditional finance and crypto
The Competitive Context: Singapore, the ECB and the US Are All Moving
The urgency behind the Woolard roadmap reflects a real competitive dynamic rather than a theoretical one. The European Central Bank is advancing tokenized central bank money settlement through its Pontes project, set to link DLT platforms to TARGET services in the second half of 2026. Singapore's Project Guardian and Hong Kong's regulatory sandbox provide parallel state-backed testing grounds in Asia. In the US, a mixture of federal and state frameworks is developing, with institutional activity in tokenized Treasuries already reaching $15 billion under BlackRock's BUIDL fund and similar products. The UK holds genuine advantages in financial law, existing asset management scale and its position as a leading venue for cross-border issuance, but those advantages do not hold indefinitely against faster-moving jurisdictions.
For the latest on how the UK's stablecoin framework is developing alongside this tokenization push, see our coverage of the Bank of England's stablecoin draft rules.
