HSBC has become the first firm approved by the Bank of England to go live in the UK’s Digital Securities Sandbox (DSS). Its Orion platform received Gate 2 approval on 13 July, the day before the Chancellor’s Mansion House speech, allowing it to operate as a Digital Securities Depository (DSD) for digitally native bond issuance, servicing and settlement. That includes DIGIT, the UK’s digital gilt, which HM Treasury confirmed will be issued by Q1 2027, with further issuances planned if the pilot succeeds. HSBC won the mandate to provide the platform for the DIGIT issuance in February.
We had suspected that part of the sandbox’s slow pace stemmed from a Bank of England preference to advance applicants through gates in groups, avoiding a first mover advantage. Approving HSBC alone hands it exactly that, although it is an edge the bank already enjoys as operator of the largest digital bond platform globally, with more than $5 billion issued on Orion. Notably, the approval also covers corporate bonds, so other Orion issuances in the UK may arrive before the digital gilt.
Alongside the Treasury update, HSBC and LSEG signed a memorandum of understanding for a bilateral DSD link. LSEG’s DSD will act as the investor DSD for settlement and asset servicing, with Orion as the issuer DSD, enabling investors to hold DIGIT through either infrastructure.
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