The UK Financial Conduct Authority has published feedback from its consultation on tokenized financial markets, after receiving 123 responses from industry groups, financial firms and legal academics. Most respondents said the clearest opening for adoption lies in post-trade functions, especially the movement of collateral between counterparties.
The FCA said the feedback will feed into a joint roadmap with the Bank of England, due later this year. That document is expected to set target dates for the UK’s work on wholesale tokenization. Separately, the regulator has opened a consultation on tokenized gold, reflecting interest in using distributed ledger technology across a wider set of wholesale market activities.
The UK move comes as tokenized securities remain a live policy issue in Europe. Last week, a coalition that included Nasdaq, Boerse Stuttgart and Securitize called on EU lawmakers to remove or materially raise proposed caps on assets eligible for distributed ledger technology infrastructure.
The UK Financial Conduct Authority published industry feedback on its plans for tokenized financial markets, moving the country closer to a joint wholesale tokenization roadmap with the Bank of England later this year.
The FCA said it received 123 responses to its consultation from industry groups, financial firms and legal academics. Most respondents identified post-trade processes as the main opening for tokenization, with the movement of collateral between parties singled out as a key use case.
Roadmap due later this year
According to the regulator, the FCA and the Bank of England will use that feedback to develop a roadmap expected later this year. The plan will set target dates for the UK’s work on wholesale tokenization.
Separate consultation on tokenized gold
The FCA also launched a separate consultation on tokenized gold after receiving responses on the topic. The regulator is examining how distributed ledger technology could be applied across a broader range of wholesale financial markets.
European firms are also pushing tokenized securities
The UK initiative comes as financial firms in Europe look to widen the use of tokenized securities. Last week, a coalition including Nasdaq, Boerse Stuttgart and Securitize urged EU lawmakers to remove or substantially raise proposed limits on assets admitted to distributed ledger technology infrastructure.
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