The UK government has chosen HSBC’s blockchain platform, Orion, to lead its new tokenized government bond pilot. The initiative, called the Digital Gilt Instrument or DIGIT, aims to modernize how the country issues and settles sovereign debt using distributed ledger technology.
HM Treasury announced the decision on February 12, 2026. The pilot will operate inside the Bank of England’s Digital Securities Sandbox. This regulated environment allows firms to test financial innovations under close supervision. If the project succeeds, the UK could become the first G7 nation to issue sovereign bonds directly on a blockchain.
How the DIGIT Pilot Will Work
HSBC’s Orion platform will handle the issuance, management, and settlement of digital gilts. Officials believe blockchain technology can make bond markets faster and more transparent. Furthermore, it could reduce costs linked to traditional systems.
Key features of the DIGIT pilot include:
- On chain bond issuance and settlement
- Faster transaction processing
- Reduced operational overhead
- Separation from the main government debt program for controlled testing
Lucy Rigby KC MP, Economic Secretary to the Treasury, said the project supports the UK’s goal of staying competitive in global capital markets. She stressed that financial innovation remains critical for attracting international investment.
Why HSBC Won the Mandate
HSBC brings strong experience in digital securities. The bank has already supported more than $3.5 billion in digital bond issuances worldwide. These deals include sovereign and corporate offerings in Hong Kong, Luxembourg, and other European markets.
The Treasury selected HSBC after a competitive tender process that began in October 2025. In addition, the government appointed law firm Ashurst LLP to advise on legal and regulatory matters tied to tokenized bonds.
Market analysts see the DIGIT pilot as a major step for blockchain in public finance. However, experts note that clear rules on legal status, taxation, and secondary trading must follow. If regulators address these issues, tokenized sovereign bonds could move from experiment to mainstream reality.
