The Bank of England published a consultation today setting out supervisory expectations for central counterparties (CCPs) seeking to accept tokenized collateral. Responses are due by 12 February 2027.
The Bank’s position is “same risk, same regulatory outcome.” Its initial view is that the existing framework does not prevent CCPs from accepting tokenized forms of eligible collateral. However, a tokenized gilt still counts as new collateral because its delivery mechanism differs, meaning CCPs must go through the Bank’s approval process before accepting it.
The most notable element is that the Bank explicitly asks for evidence on three asset types as potential future CCP collateral. These are regulated stablecoins, tokenized money market fund units (tMMFs) and tokenized gold. Stablecoins may not currently meet the Rulebook’s “highly liquid” standard, so their acceptance would require a rule change or waiver.
Article continues …
Want the full story? Pro subscribers get complete articles, exclusive industry analysis, and early access to legislative updates that keep you ahead of the competition. Join the professionals who are choosing deeper insights over surface level news.
