Bank of England Deputy Governor Sarah Breeden Says Tokenization Cuts Costs, Speeds Settlement

Deputy Governor Sarah Breeden told London’s City Week on Tuesday that tokenization—the representation of assets and money on digital ledgers—could reduce costs, speed settlement, and improve the functionality of payments and financial markets.

“FCA and BoE set July deadline for UK tokenized securities market feedback now UK regulators seek views on safe tokenization in wholesale financial markets FCA and BoE push tokenized securities roadmap with July feedback deadline soon UK tokenization plan targets securities, settlement, and collateral reforms FCA and BoE advance wholesale tokenization rules before the final 2026 roadmap UK regulators moved tokenization higher on the wholesale markets agenda with a joint call for industry feedback”

CoinCentral

Breeden said central bank money will remain the “anchor” of the monetary system even as tokenized deposits, regulated stablecoins, and potentially a retail central bank digital currency (CBDC) become part of the payment mix.

CoinCentral

She framed the policy focus as supporting new forms of digital money without weakening trust in the monetary system, while also calling for trust and interoperability to be preserved.

The Bank of England’s CBDC Academic Advisory Group said in January that "retail CBDC is not strictly required to preserve uniformity, but may play a valuable supporting role, particularly as transactional use of cash declines."

On Monday, the Bank of England proposed extending the operating hours of its core settlement infrastructure to near 24/7 availability, saying longer operating hours would help support cross-border payments and securities settlement.

The proposal is designed to better accommodate tokenized assets and evolving digital-asset workflows, with the aim of reducing friction created by legacy financial market rails that operate around fixed business-day schedules.

Cointelegraph

Breeden’s remarks also followed earlier this month comments that the Bank was reconsidering its approach to pound-sterling-denominated stablecoins, including whether to ease limits on how much consumers can hold.

The Crypto Times described the regulators’ joint commitments as including a live synchronization service targeted for 2028 and work to enable tokenized equivalents of already eligible assets to be used as collateral at central counterparties and in its own central bank operations.

The Bank of England and the Financial Conduct Authority began a joint consultation, with regulators saying it is time for the public and private sectors to use technology in financial infrastructure to stimulate economic growth and innovation.

“Tokenization is quickly becoming commonplace, and it is vital that regulators and policymakers work in concert with both current industry participants and future firms that will eventually incorporate digital assets, including tokenized securities”

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The consultation sets July 3, 2026 as the deadline for responses, and the FCA and Bank of England said they will hold industry workshops and publish a feedback statement in the summer of 2026.

The Crypto Times said the initiative includes a Digital Securities Sandbox where 16 firms have passed the first stage and are working toward going live, with the DSS expected to remain operational until December 2028 and the application window expected to close around March 2027.

In an emailed statement to The Crypto Times, Coinbase’s Katie Harries said, "Fantastic to see the UK setting out a clear vision for tokenisation in wholesale markets," and called for the ambition to reach the “unbrokered.”