- UK Finance will launch GBTD pilots at six banks and test tokenized Sterling deposits until 2026.
- Quant Network to Power Digital Pound pilot, exploring payments, retransmissions, bond settlements.
- The FCA will prepare crypto rules by 2026 as UK testing has tokenized deposits for safer and more efficient transactions.
UK Finance has launched a pilot program for tokenized Sterling Deposits (GBTD) and is advocating a step towards digital innovation in traditional banking.
The initiative, announced Friday, will be developed alongside six major banks: Bulklaze, HSBC, Lloyd Bank Group, Natwest, National and Santander, and will run until mid-2026.
The pilot will test how tokenized deposits modernize payments, reduce fraud, improve the settlement process, and align the country's wider drive to regulate crypto assets by 2026.
6 Banks Test Digital Pound Sediments
GBTD Pilot is designed to create a digital representation of commercial bank money in Pond Starling.
By joining forces with six banks, UK finance aims to measure how tokenized deposits can increase the efficiency of customers, businesses and the wider UK economy.
The initiative is expected to support safer transactions, streamline payment systems and allow consumers to have stronger control over payments.
Quant Network, a UK-based blockchain interoperability company, provides the infrastructure that underlies the project.
The company previously supported the same bank and additional institutions such as Citi, MasterCard, Standard Charter, Virgin Money, and Visa, a shared ledger-based financial market framework, tested in 2024.
Building infrastructure Quant Network
Quant's involvement allows GBTD pilots to test use cases in three areas: market payments, remote gang processes and wholesale bond settlements.
The company said the project is beyond payments and will introduce programmable money that can change the way value is managed.
The technology aims to provide improved efficiency and new payment models that can support both retail and wholesale financial activities.
The project is built directly on the previous success of RLN, creating a regulatory environment for testing distributed ledger technology in the traditional banking industry.
By applying lessons from that initiative, GBTD pilots are expected to produce more practical results that can be adopted at large scale in the coming years.
Pilots linked with future regulations
The launch will be implemented in 2026 with the Financial Conduct Authority (FCA) completing the cryptocurrency regulatory system.
In April 2025, the Ministry of Finance published a policy note that clarified how eligible Starbull coins and tokenized deposits differ from electronic money.
The FCA accelerated crypto approval after criticism and prepared the foundation for a more structured framework.
Meanwhile, the European Union has already implemented a cryptographic (MICA)-regulated market, covering many aspects of tokenization.
However, tokenized deposits remain outside of Mica's authority as they continue to fall under traditional deposit and banking rules.
This regulatory distinction highlights the UK's efforts to create a clear pathway for tokenized commercial banks' money as part of a broader financial innovation strategy.
What the project aims to achieve
The pilot is expected to run for at least 18 months, and the results are shaping future policy decisions.
By testing tokenized deposits in real-world scenarios, UK finance and its partners want to understand how they fit within a regulated banking system.
The project is positioned as an experiment to bring distributed ledger technology into mainstream financial services without replacing existing banking structures.
