A survey by Lloyds Banking Group, which polled 100 senior executives from major UK financial institutions, reveals that 71% of respondents anticipate tokenization will transform the financial services sector. Participants include leaders from banks, insurance firms, asset managers, and financial sponsors.
Respondents identified faster payments and settlement as the primary advantage of tokenization, with 60% highlighting this benefit. Additionally, 41% of those surveyed noted improved liquidity and collateral management as key outcomes. Lloyds suggests that digital infrastructure could unlock capital currently tied up in transactions.
Lloyds has actively tested this technology, conducting the UK's first public blockchain transaction earlier this year. The project involved using tokenized deposits to acquire a tokenized UK government bond, in collaboration with Archax and the Canton Network.
The UK government and regulators are working to integrate tokenization into national infrastructure. The Bank of England has proposed near-24/7 settlement availability, while a government task force projects that leadership in tokenized finance could contribute £33 billion to the annual economy by 2035.
The UK is also pursuing international cooperation, specifically with the US. Both nations have recommended forming a private-sector group to evaluate cross-border applications of tokenized assets and are seeking to align regulatory approaches between the Bank of England and US financial regulators.
