The UK plans to issue its first tokenized sovereign bond before early 2027, but on-chain cash settlement is still to be resolved

The UK plans to issue its first tokenized sovereign bond by early 2027, with the current key prerequisite being the resolution of on-chain cash settlement issues. This problem has limited the use of digital bonds by institutions for years.

Industry experts indicate that the plan may have received sufficient support from the UK Treasury, the Bank of England, and regulators to continue advancing after recent political changes, and it could potentially increase the demand for UK debt. Current progress is constrained by the lack of standardized on-chain payment methods, mature pound stablecoins, and regulatory clarity.