- UK Finance launches GBTD pilot with six banks to test tokenized sterling deposits through 2026.
- Quant Network will power a pilot for digital pounds, exploring payments, refinancing and bond settlement.
- The FCA is preparing crypto rules by 2026 while the UK tests tokenized deposits for safer, more efficient transactions.
UK Finance has launched a pilot program for tokenized sterling deposits (GBTD), marking a move toward digital innovation within traditional banking.
The initiative, announced on Friday, is being developed with six major banks—Barclays, HSBC, Lloyds Banking Group, NatWest, Nationwide and Santander—and will run until mid-2026.
The pilot will evaluate how tokenized deposits can modernize payments, reduce fraud and improve settlement processes, while aligning with the country’s broader plan to regulate crypto assets by 2026.
Six banks test digital pound deposits
The GBTD pilot is designed to create a digital representation of commercial bank money denominated in British pounds.
By partnering with these six banks, UK Finance aims to measure how tokenized deposits could boost efficiency for retail customers, businesses and the wider UK economy.
The initiative is expected to support more secure transactions, streamline settlement systems and give consumers greater control over payments.
Quant Network, a UK-based blockchain interoperability firm, will provide the underlying infrastructure for the project.
The company previously supported the Regulated Liability Network (RLN), a shared-ledger financial market framework that was tested in 2024 with the same banks and other institutions including Citi, Mastercard, Standard Chartered, Virgin Money and Visa.
Quant Network to build the infrastructure
Quant’s involvement will enable the GBTD pilot to test use cases across three areas: online marketplace payments, refinancing processes and wholesale bond settlement.
Quant Network says the project goes beyond simple payments by introducing programmable money that could change how value is managed.
The technology aims to deliver efficiency gains and new settlement models that can support both retail and wholesale financial activity.
The project builds directly on the earlier RLN work, which created a regulated environment to trial distributed ledger technology within traditional banking.
Applying lessons from that initiative, the GBTD pilot is expected to produce practical results that could be scaled in the coming years.
Pilot linked to upcoming regulation
The launch coincides with the Financial Conduct Authority (FCA) finalizing a regulatory framework for crypto assets, with implementation targeted for 2026.
In April 2025, the Treasury published a policy note clarifying how qualifying stablecoins and tokenized deposits will differ from electronic money.
The FCA has accelerated crypto app approvals following criticism and has paved the way for a more structured regime.
Meanwhile, the European Union already implemented its Markets in Crypto-Assets (MiCA) regulation, which covers many aspects of tokenization.
However, tokenized deposits remain outside MiCA’s scope because they continue to fall under existing deposit and bank regulations.
This regulatory distinction underscores the UK’s efforts to create a clear path for tokenized commercial bank money as part of its wider financial innovation strategy.
What the project aims to achieve
The pilot is expected to run for at least 18 months, with findings set to inform future policy decisions.
By testing tokenized deposits in real-world scenarios, UK Finance and its partners aim to understand how they can operate within regulated banking systems.
The project is framed as an experiment to introduce distributed ledger technology into mainstream financial services without displacing existing banking structures.