Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether her Department is taking steps to support the tokenisation of real world assets.

The government’s ambition is to be at the forefront of tokenisation adoption, given its potential to transform the UK’s financial services sector by enhancing efficiency, increasing liquidity, and strengthening risk management.

We are pressing ahead with the Digital Securities Sandbox (DSS), which provides a live regulated environment for firms to utilise tokenisation in the trading and settlement of regulated securities. This opened in September, and six firms have so far been admitted.

In November, the Chancellor announced that the Government would proceed with a pilot digital gilt issuance or ‘DIGIT’ through the DSS. DIGIT will exist solely on a digital platform, as opposed to being a tokenized real-world asset. This issuance will allow the Government to explore the potential benefits that Distributed Ledger Technology could bring to the debt issuance process and stimulate wider development of DLT platforms and infrastructures across UK capital markets.