Bank of England backs tokenization while proposing near-24/7 settlement hours
Deputy Governor Sarah Breeden also flagged a review that could ease consumer limits on GBP stablecoin holdings.
Bank of England Deputy Governor Sarah Breeden used London’s City Week to frame tokenization as a market-structure upgrade that can cut costs and speed settlement if trust and interoperability are preserved. In parallel, the central bank is proposing near-24/7 settlement operations and reopening policy on pound-sterling stablecoins, including consumer holding limits.
Key Takeaways
- Tokenization was pitched as a way to lower costs, accelerate settlement, and increase competition in UK payments and markets, with progress explicitly conditioned on trust and interoperability.
- Central bank money was positioned as the monetary system’s “anchor,” even as tokenized deposits and regulated stablecoins expand as payment options.
- The Bank of England has proposed extending operating hours of its core settlement infrastructure to near 24/7 to support cross-border payments and securities settlement.
- A Bank review is reconsidering pound-sterling stablecoin rules, including whether consumer holding limits should be eased to reduce early-adopter friction.
Breeden’s City Week Pitch: Tokenization as a Market-Structure Upgrade
At London’s City Week on Tuesday, Bank of England Deputy Governor Sarah Breeden argued that tokenization, representing assets and money on digital ledgers, can function as a practical upgrade to market structure rather than a branding exercise. She tied the case to three trader-relevant outcomes: lower costs, faster settlement, and more competition across payments and financial markets.
The gating factors were made explicit. Breeden framed the benefits as contingent on preserving trust in digital money and ensuring interoperability, meaning different payment and settlement systems can connect cleanly enough for funds and assets to move without operational dead-ends. That conditional framing matters because it signals support for innovation, but only inside guardrails that keep the system legible to supervisors and usable at scale.
Central Bank Money as the “Anchor” in a Multi-Rail Payments Future
Breeden reiterated that central bank money will remain the foundation, or “anchor,” of the monetary system even if private-sector instruments gain traction. The message was not anti-stablecoin. It was pro-framework: private digital money can grow, but inside a public-money-centered architecture.
In the speech transcript, Breeden laid out a multi-rail end state: “Alongside traditional bank deposits, people should be able to pay with tokenized bank deposits, regulated stablecoins and, potentially, a retail central bank digital currency (CBDC),” she said. She also linked competition directly to user outcomes: “More competition, from a wider range of technologies and business models, should lower costs and improve functionality for users.”
The Bank’s CBDC Academic Advisory Group added in January 2026 that “retail CBDC is not strictly required to preserve uniformity, but may play a valuable supporting role, particularly as transactional use of cash declines.” That keeps CBDC on the table without making it the prerequisite for tokenized money to work.
Near-24/7 BoE Settlement Hours: The Plumbing Needed for Tokenized Markets
On Monday, the Bank of England proposed extending operating hours of its core settlement infrastructure to near 24/7 availability. The stated rationale was straightforward: longer hours would better support cross-border payments and securities settlement as tokenization and other digital-asset technologies evolve.
For markets, this is the “plumbing” signal. Tokenized assets promise faster settlement, but that promise breaks if the central rails that finalize transfers still run on limited windows. A near-24/7 operating model is a concrete operational step that aligns with the Bank’s tokenization narrative, even though the proposal does not yet specify a final schedule, scope, or implementation date.
Sterling Stablecoin Limits Back on the Table
Earlier in May 2026, Breeden said the Bank was reconsidering its approach to pound-sterling-denominated stablecoins, including whether to ease limits on how much consumers can hold. The review was framed as an attempt to reduce friction for early adopters and support the UK’s competitiveness as a digital-asset hub.
Key details remain unresolved in the available material: the current consumer holding limits were not specified, nor were any proposed revised limits or a timeline for rule changes. The Bank has also signaled a softer stance in recent months as it engages more closely with industry and revisits earlier proposals that would have imposed stricter reserve and backing requirements, but the exact revisions under consideration were not detailed.
UK Policy Is Shifting From ‘Whether’ to ‘How’ on Tokenized Money
The threshold that matters is whether the Bank turns these signals into dated, scoped implementation. Near-24/7 settlement is the kind of operational change that can compound into real liquidity improvements, but only if the final operating schedule is broad enough to matter and the rollout timeline is credible.
This looks more like a market-structure catalyst than a one-off speech. If the stablecoin review produces clearer, less restrictive holding rules while the Bank keeps central bank money as the settlement anchor, the setup starts to look structural rather than narrative-driven, with private GBP rails expanding inside a framework that institutions can actually plug into.
