Digital Securities Sandbox (DSS)
A live, supervised environment run jointly by the Bank of England and the FCA since September 2024, where firms can test issuing, trading and settling tokenised securities. 16 firms are taking part.
UK TOKENISED SECURITIES MARKET MAP
UK Tokenised Securities Market Map
The UK’s approach is less about mirroring existing shares as tokens and more about testing new issuance and settlement inside a regulator-run sandbox. This tracks where that stands, from primary sources.
DSS / SINCE 2024/0916 FIRMS / LIVE TESTINGARCHAX / FCA FRN 838656DIGIT / HSBC GATE 2 2026/07/13FS26/1 / 2026/09/14PS26/7 / FUND TOKENISATIONSYNC SERVICE / TARGET 2028DSS / SINCE 2024/0916 FIRMS / LIVE TESTINGARCHAX / FCA FRN 838656DIGIT / HSBC GATE 2 2026/07/13FS26/1 / 2026/09/14PS26/7 / FUND TOKENISATIONSYNC SERVICE / TARGET 2028
01 · STATUS
Status points to know first
“Approved,” “rule effective,” and “live in production” are different states. This site keeps them separate.
Archax — a venue operating outside the sandbox
The UK’s first FCA-regulated digital asset exchange, combining exchange, custody and brokerage. Tokenised assets actually trade here. Looking only at the regulators’ sandbox misses this.
DIGIT — digitally native gilt issuance
HM Treasury’s pilot to issue a digitally native gilt on a platform inside the DSS. HSBC was awarded the DLT tender in February 2026 and received Gate 2 approval on 13 July 2026. Issuance has not yet taken place.
FS26/1 — feedback on tokenisation in wholesale markets
Published 14 September 2026, summarising 123 responses to the May 2026 Call for Input. It is not a rule; it feeds into a forthcoming roadmap.
Collateral mobility is the near-term focus
The authorities identify collateral mobility as the main near-term benefit, and are consulting on whether central counterparties can accept tokenised collateral.
A live synchronisation service targeted for 2028
The Bank of England has committed to launching a live synchronisation service targeted for 2028. It is not yet operating.
02 · OWNERSHIP
What exactly do you own?
Using the SEC’s January 2026 taxonomy as the anchor, classification follows legal structure and authoritative ownership records—not the appearance of the token.
Digital securities issued inside the DSS
In plain termsSecurities issued natively in digital form, rather than converted from an existing register — currently only inside the supervised sandbox.
The UK’s approach is less about mirroring existing securities as tokens, and more about testing new issuance and settlement inside a supervised sandbox.
RightsRights are designed to be preserved under existing securities law.
Authoritative recordRecords on the participating firm’s platform inside the DSS.
Tokens traded on a regulated private venue
In plain termsTokens actually traded outside the sandbox, on an FCA-regulated venue — though mainly for professional investors.
UK tokenisation does not only happen inside the regulators’ sandbox. Registered firms such as Archax run exchange, custody and brokerage together.
RightsVaries by product — mainly fund units and debt instruments rather than listed shares themselves.
Authoritative recordVenue and custodian records alongside the on-chain ledger.
Fund tokenisation
In plain termsHolding units of a fund as tokens. Not the shares themselves.
In April 2026 the FCA published Policy Statement PS26/7, setting out a framework to move fund tokenisation from experimentation to wider adoption.
RightsA claim on the fund — not shareholder rights.
Authoritative recordThe fund register and the manager’s records.
Tokens used as collateral
In plain termsLess an object of trading than an asset posted to back a trade.
The authorities are working to allow tokenised equivalents of already eligible assets to be used as collateral at central counterparties and in the Bank’s own operations.
RightsThe stated ambition is to treat them the same as non-tokenised assets.
Authoritative recordPlatform and clearing-house records.
03 · TRADING ROUTES
Where is it traded and settled?
Ownership model and trading venue are separate axes. The rules and settlement path differ by route.
Where tokenised assets actually trade outside the sandbox — the only permanently operating route in the UK.
- Archax is the UK’s first FCA-regulated digital asset exchange (FRN 838656).
- It combines exchange, custody and brokerage in one firm — a position comparable to Securitize in the U.S.
- The licence covers an exchange where at least 50% of issuers are SMEs.
- By 2026 it lists tokenised money market funds and US Treasury bill tokens, mainly for professional investors.
Almost all UK tokenisation activity currently happens inside this. It is not an open, permanent market venue.
- Jointly operated by the Bank of England and the FCA since September 2024.
- Firms can test issuance, trading and settlement under supervision, with approval required at each gate.
- Taking part is not itself an authorisation, nor an approval of any product.
- In FS26/1 (September 2026) many respondents called for a move beyond the pilot stage.
Here the government itself is the issuer. That it is government debt rather than equity is a major difference from the U.S. and Japan.
- HSBC was awarded the DLT tender in February 2026.
- Received Gate 2 approval in the DSS on 13 July 2026.
- The actual issuance has not yet taken place.
- Gate approval is progression through a stage, not product approval.
The area the authorities see as the biggest near-term benefit — making tokenised assets usable as collateral before building trading venues.
- Consulting on whether central counterparties can accept tokenised collateral.
- Use in the Bank’s own operations is also being considered.
- The stated ambition is parity with non-tokenised assets.
- A synchronisation service is targeted for 2028 and is not yet live.
04 · REALITY CHECK
Tokenization does not make everything 24/7 and instant
24/7 trading, atomic settlement, self-custody and fractionalization do not apply uniformly to every model.
How it is being approached
Traditional / currentThe U.S. tokenises existing listed shares and builds venues through exemptions and exchange rules.
What tokenization can enableThe UK tests the whole chain from issuance to settlement inside a regulator-run sandbox.
Important caveat: Participation is not authorisation. Being in the DSS does not imply approval.
What is in scope
Traditional / currentThe U.S. focuses on listed shares; Japan on real-estate trust interests.
What tokenization can enableIn the UK the front-runners are government debt, funds and collateral. Equity tokenisation is not the centre of gravity.
Important caveat: All three call it tokenisation, but the underlying assets differ.
Who is driving it
Traditional / currentIn the U.S. exchanges, the depository and firms drive it, with the regulator providing the frame.
What tokenization can enableIn the UK the central bank and regulator operate the framework, while registered firms such as Archax run the actual venue.
Important caveat: The synchronisation service would also be run by the central bank.
05 · ECOSYSTEM
Ecosystem map
This is not a regulator-approved company list. It maps roles that firms have publicly disclosed or filed, with sources.
Archax
The first FCA-regulated digital asset exchange in the UK, combining exchange, custody and brokerage in one firm (FRN 838656). It also runs a tokenisation engine and by 2026 lists tokenised money market funds and US Treasury bill tokens.
Bank of England
Co-operates the DSS with the FCA, is preparing a synchronisation service targeted for 2028 and is considering tokenised collateral.
FCA
Co-operates the DSS, published FS26/1 in September 2026 and plans a Tokenisation Roadmap later in the year.
HM Treasury
The issuer behind DIGIT, leading the pilot issuance of a digitally native gilt.
HSBC
DLT provider for DIGIT, selected in February 2026 and granted Gate 2 approval in the DSS on 13 July 2026.
06 · LICENCES
Which registration or licence allows this
Registration, effectiveness of a filing, approval and exemption are different concepts. “The SEC is involved” does not mean the same thing in each case.
DSS
Participation in the Digital Securities Sandbox
Who holds it16 participating firms, including HSBC
What it allowsAllows issuing, trading and settling tokenised securities in a live but supervised environment.
How it is obtainedApplication to the Bank of England and the FCA, with approval at each gate.
CautionParticipation is not an authorisation, and gate approval is progression through a stage — not product approval.
FCA
FCA authorisation for investment business
Who holds itFirms carrying on investment business in the UK
What it allowsDealing in, advising on or managing investments.
How it is obtainedAuthorisation under the Financial Services and Markets Act.
CautionTokenised or not, activities generally sit within the existing authorisation perimeter.
CSD
Securities settlement systems and CSDs
Who holds itSupervised by the Bank of England
What it allowsMarket infrastructure for settling and holding securities.
How it is obtainedRecognition and supervision by the Bank of England. The DSS temporarily adapts this framework.
CautionThe synchronisation service is targeted for 2028 and is not yet live.
06 · REGULATION
Regulatory and market-structure timeline
Statutes, SEC orders, SRO filings, no-action letters, staff views and company plans are not given the same legal weight.
Live / available
The Digital Securities Sandbox goes live
The Bank of England and the FCA began joint operation, creating a supervised environment for issuing, trading and settling tokenised securities.
Approved · launch pending
HSBC awarded the DIGIT DLT tender
HM Treasury selected the technology provider for its pilot digital gilt issuance.
Effective
FCA publishes PS26/7 on fund tokenisation
It set out a framework to move fund tokenisation from experimentation to wider adoption.
Staff view / No-Action
FCA and Bank of England set out a shared vision
They set out their direction for tokenisation in wholesale markets alongside a Call for Input.
Approved · launch pending
HSBC receives Gate 2 approval in the DSS
A step forward towards DIGIT. The actual issuance has not yet taken place.
Staff view / No-Action
FS26/1 published, summarising 123 responses
Respondents broadly called for moving beyond pilots; collateral mobility was identified as the near-term focus. A Tokenisation Roadmap is expected later in the year.
07 · SOURCES
Primary-source library
SEC, DTCC/DTC, NYSE/ICE and Nasdaq are prioritized. Company materials are clearly identified as company sources.
FS26/1: Tokenisation in wholesale markets
FCA · 2026-09-14 · Primary source
Feedback Statement FS26/1 — Tokenisation in Wholesale Financial Markets (PDF)
FCA · 2026-09-14 · Primary source
FCA and Bank of England set out shared vision for tokenisation in UK wholesale markets
FCA · 2026-05 · Primary source
FCA and BoE set out shared vision for tokenisation in UK wholesale markets
Bank of England · 2026-05 · Primary source
Archax — FCA-Regulated Digital Asset Exchange (FRN 838656)
Archax · Company source
Archax — Tokenisation
Archax · Company source
Trade Digital Assets on an FCA-Registered Exchange
Archax · Company source
08 · METHODOLOGY
How to read this map
First identify what the investor legally holds, then identify the trading route, and finally verify the authoritative source and operating status. The word “tokenized” alone does not determine shareholder rights, counterparty risk or settlement cycle.
1LEGAL HOLDING→2TRADING ROUTE→3AUTHORITATIVE SOURCE→4LIVE STATUS