The government has published an Update Report on progress against the Strategy. The Update Report includes a detailed update on progress in the FinTech space.

On the same day as the Mansion House speech, Christopher Woolard, the Wholesale Digital Markets Champion (WDMC) – who was appointed in April 2026 - published his first Report to the Chancellor on the future of the UK wholesale digital markets.

The WDMC’s Report identifies a number of strategic priorities, including:

• creating a clear direction towards scalable live tokenised markets that drive industry investment;
• developing tokenised collateral to support the development of tokenised markets;
• establishing of a market for tokenised investment funds;
• introducing wholesale payment rails that support tokenised markets;
• establishing legal certainty and best practice to remove perceived and real obstacles;
• regulatory standards that support tokenised markets;
• standards that support domestic and international interoperability and convergence;
• effective financial crime compliance; and
• supporting the development of industry standards of digital verification and identity.

Further information on the current state of play on these initiatives can be found below.

The WDMC noted that technological progress alone is insufficient. Tokenisation initiatives need to move beyond issuance and address the full lifecycle, particularly secondary markets, collateral usability and interoperability, to ensure that assets are investible at scale. That will require coordinated changes across legal frameworks, regulation, taxation, settlement systems and market practices – which, in turn, will require close collaboration between the government, the Bank of England, the FCA and the industry.

In addition to these points, the WDMC made a number of further specific policy suggestions for the UK government to consider. The WDMC has asked for industry feedback on the Report by 4 September 2026.

The Digital Gilt Instrument (DIGIT) is an HMT initiative to issue and settle the UK’s first natively digital sovereign bond using distributed ledger technology. This will take place within the Bank of England and FCA’s Digital Securities Sandbox.

In February 2026, HSBC was selected as the issuance platform for the inaugural DIGIT pilot.

The Chancellor announced that, by early next year, the first DIGIT will be issued. The WDMC suggested that this should be no later than Q1 2027. The intention is also that there will be further digital issuances over the medium term.

The WDMC says that tokenised collateral is required to support the development of tokenised markets. He reported that bilateral repo transactions have already taken place on-chain, but the next step in order to scale the use case for tokenised collateral is end-to-end, ecosystem-wide transactions involving FMIs. To that end, he has suggested that the Bank of England should be prepared to accept DIGIT as collateral in the Sterling Monetary Framework and should consider broader acceptability of tokenised collateral in the market, for example for use in central counterparties (CCPs).

Tokenising investment funds is also seen as an objective. The Investment Association is operating an Investment Fund 3.0 (IF3) Lab to develop funds use cases, and in June 2026, the UK’s first fully tokenised investment fund was launched.

Further work is required in the area of tokenisation generally. In May 2026, the Bank of England and FCA launched a joint Call for Input regarding tokenisation in wholesale markets. The FCA said at the launch of that initiative that it would be holding workshops over the following few months and would publish a response statement over the summer.

A full roadmap for the Bank of England’s and FCA’s work on digitalisation of wholesale markets is expected later in 2027.

The transfer of digital assets will need to be matched with a corresponding, secure payment leg. The Bank of England is enhancing RTGS and its access frameworks to support this transition, including through:

• Omnibus Accounts launched in 2022, enabling tokenised central bank money for wholesale settlement;
• the planned launch of a synchronisation service in 2028; and
• consulting on extending RTGS and CHAPS settlement to near 24/7 operation.

The Dematerialisation Market Action Taskforce has published a Report setting out its implementation plan for the withdrawal of paper share certificates, the first of three stages on the path to full digitisation of share ownership in the UK. The last of those three stages, with an intermediated model for dematerialised share ownership, is expected to begin before the end of this Parliament – that is, by 2029.

The aim for the first stage is that the full withdrawal of paper share certificates will be achieved by the end of 2027. From that date, paper share certificates no longer constitute evidence of ownership title, and in-scope shares will be held and transferred through digital registers alongside holdings on the Central Securities Depository.

The Report sets out a detailed implementation plan for how that is to be achieved. Key to this plan is the development of a Digital Register for shares. Legislative changes will also be needed to support the first stage, to remove certain obstacles that exist in the current legislation.

The government’s stated aim is to make the UK a global leader in next-generation payments. On the day of the Mansion House speech, the government published a consultation setting out its intention to create a single regulatory regime for tokenised and traditional payments, under a streamlined regulatory framework. The consultation closes on 6 October 2026. Take a look at this Our Thinking article for more on the proposals.

Under the Payments Vision Delivery Committee (PVDC), work is underway to deliver next generation retail payments infrastructure, which is intended to support innovation in – and interoperability between – new forms of digital money.

In line with the National Payments Vision and as part of last November’s Strategy for Future Retail Payments Infrastructure published by the PVDC, on 25 June 2026 the Retail Payments Infrastructure Board (RPIB) published a consultation on the design of the infrastructure. This was followed, on 2 July 2026 by the PVDC’s publication of an update on roles and responsibilities in the future retail payments ecosystem. The RPIB consultation closes on 11 September 2026.

The new industry-led Delivery Company that will implement the design is expected to progress the core infrastructure later in 2026.

In 2025, a number of UK banks began an industry-led initiative to deliver tokenised sterling deposits via a project known as the Great British Tokenised Deposit (GBTD). The project has completed its live transaction under a pilot, which was aimed at three use cases: person to person payments via online marketplaces, remortgages and digital asset settlement.

The government has now reported that GBTD is working with the RPIB to support coherence with the RPIB’s work on next generation retail payments infrastructure.

The WDMC has suggested that the industry should build end-to-end tokenisation use cases that work across both existing and new payment rails, and that there should be shared token standards, common Application Programming Interfaces (APIs) and data models (including through the Common Domain Model) to deliver interoperability.

The UK will shortly be implementing an entirely new regime for the regulation of cryptoassets. Firms which provide cryptoasset-related services in the UK after 25 October 2027 will need to be authorised by the FCA to do those activities. At the end of June 2026, the FCA published its final set of policy statements – which set out the rules relating to regulated crypto activities (clarifying points that arose during consultation), admissions and disclosures, market abuse and prudential matters (including regulatory capital and operational resilience).

These publications mean that firms should now have a pretty much complete picture of how the UK’s cryptoasset regime will operate, and should be able to consider whether to apply for authorisation or vary their permissions.

The FCA also published a policy statement with final rules for non-systemic UK-issued qualifying stablecoins which will be covered by the new regime (see this Our Thinking article), along with the approach to joint FCA/Bank of England regulation of systemic stablecoin issuers (see this Our Thinking article). This follows the Bank’s publication of a policy statement and draft rules (Code of Practice) on the systemic stablecoin regime earlier in the month (see this Our Thinking article).

This progress on stablecoins is particularly timely given that a report by the House of Lords Financial Services Regulation Committee (also published in June) highlighted that the UK has been lagging behind in developing its regulatory regime for stablecoins compared to the U.S. and EU.

Legislation on tax rules for stablecoins and cryptoassets will be introduced in the Finance Bill 2026-27.

The DSS is active, allowing firms to test digital securities safely while protecting stability and market integrity. The Bank of England has approved the first firm to conduct live activity, and announced on 30 June 2026 that certain stablecoins can be used for settlement in the DSS.

The WDMC’s Report said that the next step is ensuring a clear route out of live sandboxes and testing grounds into at-scale, regulated activity under lasting, permanent regulatory regimes.

On the day of the Mansion House speech, HM Treasury published an AI Adoption Plan, which was developed by the government’s independent AI Champions for financial services (Harriet Rees of Starling Bank and Dr Rohit Dhawan of Lloyds Banking Group).

The Plan focuses on next steps for the government, regulators and industry to accelerate safe AI adoption and innovation in the financial services sector. It makes ten recommendations:

While the recommendations focus on specific challenges for financial services, the AI Action Plan also refers to cross-sector barriers that impact financial services, such as AI sovereignty and resilience, and makes proposals for addressing those issues.

The government has welcomed the Plan and accepts its recommendations.

In the context of retail financial services, Sheldon Mills, an executive director at the FCA, also recently published the results of a review on the impact of artificial intelligence. See our article for more information on the Mills Review. 

Authored by Dominic Hill and Virginia Montgomery.