UPDATE 1-UK picks HSBC as platform provider for its digital bond pilot issuance

The ​UK has chosen HSBC's blockchain ​platform to run the ‌country's pilot ​issuance of tokenised or digital government bonds, the bank said on Thursday, a move ‌that puts Britain ahead of its G7 peers in exploring blockchain-based sovereign debt. The UK's "Digital Gilt Instrument" pilot, which was announced in 2024, ‌tests how distributed-ledger technology could make capital markets more efficient ‌and reduce costs for financial institutions.

The ​UK has chosen HSBC's blockchain ​platform to run the ‌country's pilot ​issuance of tokenised or digital government bonds, the bank said on Thursday, a move ‌that puts Britain ahead of its G7 peers in exploring blockchain-based sovereign debt.

The UK's "Digital Gilt Instrument" pilot, which was announced in 2024, ‌tests how distributed-ledger technology could make capital markets more efficient ‌and reduce costs for financial institutions. It is unclear when the government plans to issue the gilt using the new technology. Patrick George, HSBC's global head ⁠of ​markets and securities services, ⁠said in a statement that the bank was "delighted" to support the development ⁠of the gilt market and wider UK economy.

George said the bank's Orion ​platform had a "proven track record" of delivering successful outcomes in ⁠other jurisdictions, having enabled the issuance of more than $3.5 billion in digital bonds globally ⁠across ​the sovereign, central bank, financial institution, and corporate sectors. The government also appointed Ashurst LLP to provide legal services for ⁠the DIGIT pilot, it said in a statement. While interest in issuing ⁠traditional assets ⁠on blockchain is rising globally, tokenised debt remains a small fraction of the market.

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