FCA and PRA propose aligning tokenized assets with traditional instruments, aiming to modernize UK wholesale markets by 2028.
UK regulators have outlined plans to enable near-24/7 settlement for tokenized financial instruments, treating them equivalently to traditional assets under updated guidance. The Prudential Regulation Authority (PRA) replaced its 2022 framework, signaling interim rules until a broader prudential framework is finalized post-Basel Committee review in 2028.
The Financial Conduct Authority (FCA) launched a public consultation on tokenization, emphasizing its potential to expand capital access for unbrokered individuals globally. The PRA’s guidance applies where legal rights and risks mirror conventional instruments, reflecting a cautious but progressive approach.
Market participants, including Coinbase, praised the UK’s vision for fostering innovation while maintaining regulatory parity. The Basel Committee’s ongoing review of crypto asset exposure standards will inform the PRA’s long-term framework, expected no earlier than 2028.