Three-Quarters of UK Finance Chiefs Bet Their Next Quarter Is Tokenized

Nearly three-quarters of senior decision-makers at major UK financial institutions expect tokenization to reshape financial services, according to an annual survey released by Lloyds Banking Group, the UK's largest financial services provider. The poll of 100 senior executives at UK banks, insurers, asset managers and financial sponsors found faster payments and settlement to be the most-cited potential benefit, named by 60% of respondents, while 41% pointed to improved collateral and liquidity management. Lloyds said shifting assets and payments onto digital infrastructure could also free capital and liquidity tied up in transactions, allowing institutions to redeploy those resources elsewhere.

Rob Hale, co-head of global markets at Lloyds, said: "The next phase is about turning those individual use cases into infrastructure that works at scale, with the interoperability and common standards needed to connect digital and traditional markets." Lloyds has tested the technology directly, having earlier this year worked with Archax and the Canton Network on what it described as the UK's first public blockchain transaction using tokenized deposits to purchase a tokenized UK government bond.

The survey lands as UK policymakers push to move tokenization beyond pilots and into the country's financial infrastructure. The Bank of England proposed extending its core settlement infrastructure toward near-24/7 availability in May, and a subsequent government payments blueprint called for tokenized and traditional forms of money to operate within an interoperable payments system. In the same month, the US and UK treasuries recommended creating a private-sector group to test cross-border uses of tokenized assets and urged US financial regulators and the Bank of England to identify shared regulatory approaches.

In July, a government-backed industry task force estimated that leadership in tokenized finance could add as much as 33 billion British pounds ($44 billion) to the UK's annual economic output by 2035, while calling for the country's first tokenized government bond by early 2027. The UK's Wholesale Markets Digital Strategy laid out the projected opportunity, and officials said coordination with US counterparts on cross-border tokenized asset testing would continue alongside domestic policy work.