UK Tokenization Could Add $44 Billion to Market by 2035

The United Kingdom could boost its annual economic output by as much as 33 billion British pounds ($44 billion) by 2035 if it becomes a global leader in tokenized financial markets, according to a government-backed industry task force. The projection appears in the first report from Wholesale Digital Markets Champion Chris Woolard, who was appointed by HM Treasury to help deliver the government's digital markets strategy.

Prepared alongside an industry task force, the report outlines a 12-month roadmap to test blockchain technology in securities financing transactions, where financial assets are used as collateral to borrow cash. It also recommends issuing the UK's first tokenized government bond during the first quarter of 2027.

The task force includes more than 50 organizations spanning both traditional finance and the crypto industry, including BlackRock, Goldman Sachs, JPMorgan, Morgan Stanley, HSBC, UBS, Coinbase, Circle, Ripple, Kraken, DTCC and Euroclear. Rather than focusing solely on pilot projects, the roadmap aims to establish live tokenized markets where securities can be traded, settled and used as collateral. The report states that the next step is to move “from pilots to scale” and “from ambition to action.”

Supporting the initiative, Ripple said on Monday that tokenized financial products have already moved beyond experimentation. “Onchain funds, bonds and repo aren’t experiments,” the company said, adding that these instruments are already proving “cheaper, better and faster than their legacy equivalents.”

Government expands plans for digital gilts

The proposal to issue a tokenized UK government bond, or digital gilt, builds on earlier government initiatives rather than introducing a completely new concept. The UK first announced its Digital Gilt Instrument pilot in November 2024, followed by a July 2025 update outlining plans for onchain settlement, over-the-counter trading and the development of a secondary market. In February 2026, the government selected HSBC’s Orion platform to support the project.

The latest report goes further by introducing a clear implementation timeline and expanding the envisioned role of digital gilts. In addition to issuing the first tokenized government bond, the report recommends future issuances, active secondary-market trading and eligibility for use as collateral at the central bank.

According to the report, tokenized securities can only reach their full potential if they can be actively traded or used to raise liquidity. It therefore calls on the Bank of England to accept digital gilts as eligible collateral.

Existing infrastructure could support tokenized markets

The report also highlights that the UK already has elements of the infrastructure needed to support tokenized financial markets. In December 2023, London-based Fnality launched a sterling-denominated wholesale payment system backed by central bank reserves. The platform was designed to facilitate real-time repo transactions, settlement of tokenized securities and cross-border payments.

Combined with the proposed tokenized gilt program, this infrastructure could provide the foundation for broader adoption of blockchain-based financial markets across the UK.

Sources:

https://www.gov.uk/government/publications/announcement-of-preliminary-market-engagement-exercise-for-the-digital-gilt-instrument-digit-pilot/additional-information-and-engagement-on-the-digital-gilt-instrument-digit

https://cointelegraph.com/news/uk-tokenization-44-billion-annual-output-2035

https://www.theglobalcity.uk/digital-markets-champion

https://x.com/Ripple/status/2076582147696001265