UK banks complete first live tokenised
Major UK banks have executed the first live customer transactions using tokenised sterling deposits via the Great British Tokenised Deposit initiative.
UK banks have completed the first live customer transactions using tokenised sterling deposits. The transactions were delivered through the Great British Tokenised Deposit initiative, known as GBTD.
This marks a significant step in modernising UK banking infrastructure. Programmable money is now being used in real customer transactions. The first set of transactions included remortgage completions and a consumer shopping trial.
How the technology works in practice
Tokenised deposits enable trusted commercial bank money to be used on digital networks. Payments can move faster and settle more efficiently. They can also be programmed to execute automatically when specific conditions are met.
In both live cases, programmable tokenised deposits allowed money to be 'locked' in the buyer’s account. Release occurred only upon successful exchange of goods. The first two transactions were remortgage completions. This process reduced manual checks and settlement delays.
The second trial was a consumer 'marketplace' transaction where a person purchased an item from a private seller. This mechanism helped reduce transaction risk. It also builds greater trust in online commerce.
Industry collaboration and infrastructure
The transactions were executed on the GBTD platform. This platform was developed by Quant as a shared UK industry infrastructure for tokenised commercial bank money. The initiative was convened by UK Finance and involves major banks and building societies.
The GBTD initiative involves the following participants:
Future applications and benefits
Further pilots are expected over the next few months. They will demonstrate digital-asset settlement by linking tokenised customer money with digital assets for seamless exchange. Banks in the project will issue digital debt instruments that can be traded and settled. Coupons will be paid in tokenised deposits.
This will unlock the benefits of delivery-versus-payment-versus-reserves. UK Finance said the move retains the trust and regulatory protections of conventional deposits. It also offers benefits like programmability, speed, and efficiency.
The mortgage transactions showed how customers can continue to earn interest on funds held in their accounts until completion. The pilots explored how connecting with HM Land Registry digitally could improve future transaction efficiency. Once scaled, potential benefits include reduced fraud and greater customer control over funds.
Jana Mackintosh of UK Finance said: "These live transactions show how tokenised deposits can deliver practical, real-world benefits and contingent payments that give customers greater control over their money." Further pilots are expected over the next few months to demonstrate digital-asset settlement by linking tokenised customer money with digital assets for seamless exchange.
