HSBC Orion Named Platform Provider for UK’s Tokenized Gilt Pilot

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The UK Treasury has appointed HSBC Orion as the platform provider for the Digital Gilt Instrument pilot, known as DIGIT. With this move, the country is on track to become the first among the Group of Seven nations to issue tokenized sovereign bonds on a blockchain network.

The announcement came through a press release on Thursday, outlining that the pilot is designed to test the use of distributed ledger technology in the issuance of UK sovereign debt. Officials aim to lay the groundwork for DLT infrastructure and encourage broader adoption across the nation’s financial markets.

HSBC released a separate statement emphasizing the transformative potential of the initiative. The bank noted that issuing digital gilts and digital corporate bonds on a blockchain could lead to meaningful improvements in the UK’s debt capital markets. A key benefit cited was the significant acceleration of transaction settlement times.

The DIGIT pilot will involve the issuance of a digitally native, short-term instrument. This will take place on a platform operating within the Digital Securities Sandbox. The settlement process will occur onchain and will operate independently of the government’s primary debt management operations. The Treasury is in discussions with additional suppliers to contribute to the project alongside HSBC.