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The UK’s City minister has highlighted the government’s plan to issue a bond using blockchain technology as “actively bringing digital innovation to the heart of government” in a keynote speech.
HM Treasury (HMT) has been gearing up for the issuance of a ‘digital gilt instrument’ – being referred to as ‘DIGIT’ and issued using distributed-ledger technology (DLT) – for the past 18 months, with the idea first put forward by the previous administration.
A gilt is a government liability denominated in sterling and listed on the London Stock Exchange. They have been issued by the UK Debt Management Office (DMO) on behalf of HMT since 1998.
DIGIT will be issued on a platform operating within the ‘Digital Securities Sandbox’ (DSS), which was opened in 2024 by the Bank of England (BoE) and Financial Conduct Authority (FCA). Sandboxes are (virtual) spaces for projects to test and experiment with new technology, overseen by regulators, and/or for authorities to themselves hone regulation.
“When I talk about collaboration between industry and government, I don’t mean government just sitting back and watching while industry does all of the work,” Lucy Rigby told a conference of largely private-sector financial and regulatory experts in London. “We’re actively bringing digital innovation to the heart of government by using the sandbox for the launch of DIGIT – we intend to issue a digitally native government bond to deliver two key aims: both exploring how DLT can be applied to our debt issuance process and to catalyse the development of digital markets, putting the UK firmly at the centre of global markets.”
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UK government wants to ‘go further’
Rigby was speaking at the ‘London Tokenisation Summit’, organised by conference company City & Financial Global, giving a short keynote speech remotely during a trip to China.
“Tokenisation and digital assets are moving more and more from the margins of finance into the mainstream,” she said during the 29 January speech, which largely comprised a summary of UK progress on regulatory initiatives.
In experimenting with a ‘blockchain bond’, the UK government will be playing catch-up with administrations including Hong Kong, the Philippines and Thailand, as well as city authorities such as Lugano (Switzerland) and Quincy (Massachusetts, US). The World Bank and European Investment Bank (EIB) have been in the vanguard at a multilateral level.
“We must go further than digital issuances that have taken place across the world already, and that is why we’re looking to deliver an ambitious set of features, including on-chain [on blockchain] settlement, supporting interoperability, over-the-counter trading, and we’ll be working with industry and the digital markets champion to explore collateral mobility and secondary market trading,” Rigby said in her speech.
The government announced its intention to appoint a ‘digital markets champion’ to ‘lead, join up and coordinate the private sector’s work’ in July 2025 in its ‘Wholesale Financial Markets Digital Strategy’. It aimed to fill the role in the autumn.
Read more: UK government readies procurement for digital gilt issuance
DIGIT: further announcements due
Rigby – who was appointed City minister (her role is also economic secretary to the Treasury) in September 2025 – said in her speech there would be “further announcements on DIGIT as we prepare to issue.”
HMT and the DMO (which is an executive agency of HMT) launched a ‘preliminary market engagement exercise’ ten months ago to ‘seek information to understand what technological options are available to facilitate an issuance, and how DIGIT can be best designed to stimulate wider development and adoption of DLT infrastructure across UK capital markets.’
In July 2025 a ‘DIGIT pilot update’ was published in which the government stated that it had been ‘carefully reviewing responses to inform its next steps’ and listed the features, reiterated by Rigby in her speech, that the pilot would aim to test.
A procurement evaluation process has since been completed but the winner has yet to be announced.
The previous Conservative government’s ‘Spring Budget 2024’ contained a commitment to ‘continue to examine, and [plan to] engag[e] with firms on, the possible applications and benefits of applying DLT to a sovereign debt instrument.’
After the election of the Labour government in July 2024, chancellor of the exchequer Rachel Reeves confirmed plans for DIGIT in speech in November 2024, with details revealed four days later by then-economic secretary to the Treasury Tulip Siddiq.
The gilt market comprises two types – conventional gilts and index-linked gilts. The pilot aims to issue a digital bond ‘with similar features to a conventional gilt’ and will ‘sit outside of and be separate from the Debt Management Office’s gilt and Treasury Bill operations’ because it is ‘experimental’, according to Siddiq’s parliamentary statement (November 2024).