The Bank of England will focus on tokenization - ForkLog: cryptocurrencies, AI, singularity, the future

# Bank of England Focuses on Tokenization

The Bank of England will focus its future strategy on RWA to modernize the country's economic sector. This was stated by Deputy Governor for Financial Stability Sarah Breeden.

At the City Week 2026 conference in London, the official explained that the retail payment system of the future should include various interchangeable forms of money — tokenized deposits, stablecoins, and possibly central bank digital currency (CBDC).

According to her, distributed ledger technology will reduce costs and speed up payments, with fewer intermediaries. Smart contracts will add flexibility through customizable conditions and automation.

She also noted that the regulator actively supports the adoption of AI, including agent-based payments and commerce.

Next month, the Bank of England will publish draft rules for systemic "stablecoins" and approve them by the end of the year, Breeden said. To reduce the risks of rapid proliferation of such assets, the regulator may temporarily limit their issuance volume.

Regulator’s Plans

On May 18, the Bank of England and FCA launched a joint consultation on the tokenization program. It is based on the Digital Securities Sandbox, which started operating in 2024 and will run until January 2029. The platform allows companies to launch trading systems and settlements for tokenized securities.

Since late 2026, 16 companies, including Euroclear, HSBC, and the London Stock Exchange Group, are preparing to join the sandbox.

"A prudential regime for British banks regarding tokenized assets will be the same as for non-tokenized equivalents if legal rights are identical and risks are comparable," — Breeden said.

Additionally, the Bank of England will continue supporting the Digital Gilt initiative — a pilot project for tokenized sovereign bonds.

The regulator will present the results of the CBDC design phase by the end of the year.

"The task of authorities, government, and industry is to rely on a solid foundation of the UK and demonstrate that we are deepening the ecosystem of tokenized finance," — Breeden said.

The approach of British authorities aligns with global trends. On May 19, Japan’s ruling Liberal Democratic Party officially committed to building the future financial system using AI and blockchain, with a focus on tokenization, stablecoins, and agent-based commerce.

Recall that in April, the UK Treasury announced plans to implement "stablecoins" in the payment sector.