UK regulators share feedback on tokenisation and open call for input on tokenised gold

In a Call for Input earlier this year, the Financial Conduct Authority and Bank of England outlined how they plan to support the adoption of tokenised securities. Now the regulators have shared feedback on that paper and promised a roadmap later this year. The FCA has opened a new Call for Input seeking more targeted views on whether tokenisation could improve the way gold is traded, transferred, pledged and held in UK markets.

Feedback on tokenisation in wholesale markets

The FCA and Bank used their May 2026 Call for Input to provide their initial thinking on priority initiatives to support tokenisation in the UK’s wholesale financial markets. According to FS26/1, respondents agreed that tokenisation represents a major opportunity, with firms calling for faster progress. Respondents also supported the regulatory principles set out in the paper which will inform the regulators’ supervisory approach and any future changes to rules.

Key takeaways from the feedback include:

• Collateral: The FCA and Bank agree with respondents that the main benefit to wholesale markets is likely to be improving collateral mobility. The regulators say they will progress work on tokenised collateral, including considering the eligibility of tokenised assets like stablecoins as collateral. They also commit to giving industry clarity on the prudential and collateral treatment of tokenised assets.

• Custody: Respondents provided views on whether safeguarding arrangements for relevant specified investment cryptoassets (RSICs) should align with CASS 6, which applies to traditional safe custody assets, or CASS 17, which applies to cryptoassets. Earlier this year the FCA confirmed that, for now, RSICs would be regulated under CASS 6 rather than CASS 17 as they had originally proposed. Respondents broadly agreed that additional requirements relating to security, controls and the management of crypto-specific technology risks would be needed for RSICs.

• Settlement: Several respondents want to use tokenised assets, such as stablecoins, as settlement assets. Since the Call for Input, the regulators have confirmed that stablecoins can be used as settlement assets in the Digital Securities Sandbox, subject to conditions and to HM Treasury amendments to regulations.

• Prudential: In the Call for Input, the regulators committed to treating tokenised and non-tokenised assets the same “where legal rights are identical and underlying risks are comparable”. Respondents asked for further clarity on what this means in practice. In their feedback, the regulators say they will provide further clarity on this and that firms should keep applying the existing framework in the meantime.

• DeFi: Some respondents argued that the regulatory principles would be difficult to meet for firms making use of decentralised finance and so were not, in practice, technology neutral. In response, the regulators reiterated that regulated financial services activities should continue to be delivered by regulated firms. These firms may use DeFi software provided that they remain accountable for outcomes like operational resilience and KYC.

Tokenised gold

In its new Call for Input, the FCA explains that it expects demand to grow for high-quality collateral, more efficient settlement and tokenised real-world assets. It notes that tokenised gold may interact with multiple regulatory regimes and sees its role as providing strategic clarity in response to industry-led innovation.

The FCA invites feedback on a menu of potential policy initiatives. The options range from the FCA publishing a good and poor practice note through to creating a bespoke regime for tokenised gold alongside HM Treasury.

The FCA’s Call for Input on tokenised gold closes on 23 October 2026.

Next steps

The papers look ahead to several initiatives that will follow in the coming months, including:

• The FCA and Bank will publish a tokenisation roadmap later this year. The roadmap will set out how the FCA and the Bank intend to progress work on wholesale tokenisation, including target dates and key dependencies, e.g. where legislation is needed.

• The FCA will release a consultation paper on the custody of RSICs in H1 2027. For now, the FCA will continue to assess firms safeguarding RSICs against CASS 6.

• The FCA will also consult on resolution and insolvency for stablecoin issuers and cryptoasset custodians.

• The Bank will consult on a supervisory statement and discussion paper later this year on the acceptance of tokenised collateral by central counterparties (CCPs).

We have been actively involved in industry discussions relating to tokenisation in UK financial markets. Get in touch with us if you would like to discuss.