UK Finance is an established trade association representing over 300 member institutions in the UK financial services sector, added amounting to more than 300 banking bodies in the United Kingdom, has unveiled the pilot of a project to investigate tokenized sterling deposits (GBTD).
The project, which we announced on Friday, is aimed at developing and testing Bank of England-backed, digital deposits representing UK commercial bank money.
The banks participating in the pilot are Barclays, HSBC, Lloyds Banking Group, NatWest, Nationwide, and Santander.
The project is anticipated to run until mid-2026 and will explore how tokenized deposits might provide benefits to consumers, businesses, and the economy, such as thwarting fraud, faster clearing and settlement, and greater capability to control payment systems.
Quant Network to Provide Key Infrastructure
Quant Network, located in the United Kingdom, will provide technical architecture for the GBTD project, which is the only blockchain interoperability platform of its kind.
Also, Quant has experience with large-scale financial innovation and already has followed the first phase of the Regulated Liability Network (“RLN”), a shared ledger financial infrastructure project, which launched in 2024.
RLN was part of a sandbox that involved the same 6 banks that are participating in the GBTD trial today, plus global firms, Citi, Mastercard, Standard Chartered, Virgin Money, and Visa.
This collaboration shows Quant’s growing importance and influence in developing digital finance frameworks in the UK and beyond.
Also Read: Bank of England Mulls Crypto Exposure Limits for UK Banks by 2026
Exploring Three Main Use Cases
The GBTD pilot will evaluate three use cases that will highlight the efficiency and applications of tokenized deposits.
These include enabling online marketplace payments, improving the remortgaging process, and facilitating wholesale bond settlements.
Quant’s founder and CEO, Gilbert Verdian, told The Times: “This project, while it reduces friction and makes payments faster, is not just about payments, but also about programmability, and this programmability could ‘fundamentally change how value is moved and managed.”
Verdian stressed that Quant’s contribution demonstrates its leading position in digital finance, working with the UK’s largest institutions to build the infrastructure for the next economic phase.
Also Read: US And UK Launch Joint Taskforce For Boosting Crypto Markets Of The Future
UK Pilot Aligns With Regulatory Shifts in Europe
The GBTD pilot is being launched as the UK Financial Conduct Authority (FCA) concludes its crypto regulatory framework that will be fully operational by 2026.
Earlier in 2023, the UK Treasury issued guidance clarifying that tokenized deposits and qualifying stablecoins are not electronic money, before any base regulations are in place.
The FCA has reportedly been faster in approving crypto products since the aforementioned critique regarding the slow approvals, along with the European Union already having passed the Markets in Crypto-Assets (MiCA) regulation in late 2024.
Even though MiCA governs tokenization in general, tokenized deposits remain under existing banking regulations.
On September 25th, UnoCrypto reported that nine European banks are working to build a euro-denominated stablecoin under MiCA regulations.
That group has established an entity in the Netherlands and is awaiting an e-money license from the Dutch central bank, with the goal of establishing a euro-denominated alternative to non-EU stablecoins and supporting cross-border 24/7 payments.
This concurrent development highlights that both the UK and EU are receiving a relatively swift overhaul of the digital finance landscape with tokenization in motion.
Also Read: UK FCA Proposes Full Crypto Rulebook To Bring Firms Under Traditional Finance Standards By 2026