HM Treasury has chosen HSBC to supply the technology for the Digital Gilt Instrument pilot, a step meant to update part of London’s financial infrastructure. The selection, announced on 12 February 2026 after a tender that began in autumn 2025, means the Orion blockchain platform will support the first UK government bond created only in digital form. Britain now appears likely to become the first G7 country to issue a sovereign bond that runs on distributed ledger technology.
The pilot will operate inside the Financial Conduct Authority’s Digital Securities Sandbox. This controlled space lets the Treasury and market participants test every stage of the digital gilt’s life, from first sale to secondary trading and final settlement, without affecting the existing gilt market. Rather than issuing a simple digital copy of a conventional bond, the Treasury intends DIGIT to be “digitally native” and to use the full capability of the blockchain. Bonds issued this way settle on chain, a change that could shorten the settlement cycle from the present two day standard to a few minutes.
From T+2 to T+Minutes: The Gilt Trip Goes Digital
Economic Secretary to the Treasury, Lucy Rigby KC MP, made it clear that this is not merely a technical experiment but a strategic play for global competitiveness. She argued that embracing this kind of financial innovation is exactly what is required to keep the UK at the vanguard of global capital markets, attracting investment and driving down costs for businesses. HSBC’s selection is far from symbolic. Its Orion platform brings a formidable track record to the table, having already facilitated over $3.5 billion in digital bond issuances across Europe and Asia. This portfolio includes the European Investment Bank’s inaugural digital sterling bond back in 2023 and a landmark multi-currency green bond for the Hong Kong government last year, demonstrating the platform’s capability across different jurisdictions and asset classes. Patrick George, HSBC’s Global Head of Markets, framed the mandate as a natural fit for the bank in its home market, positioning it as a direct contributor to the evolution of the gilt market and the broader British economy.
The DIGIT initiative dovetails with the government’s wider vision for its capital markets. Chancellor Rachel Reeves signalled this intent as far back as late 2024, projecting that digital gilts could become a reality within a two-year window. This pilot is the tangible, pragmatic step towards that ambition, designed to generate the operational proof required before any thought of wider, systemic rollout. It’s a move that keeps the Treasury’s existing regulatory controls firmly in place while dipping a toe into the waters of technological revolution.
This push for modernisation comes against a backdrop of a rapidly shifting regulatory landscape for digital assets in Britain. The FCA has recently shown a willingness to crack open the door to crypto exposure for retail investors, most notably by lifting its four-year ban on crypto Exchange Traded Notes (ETNs) in October 2025. However, this liberalisation has been far from smooth. It was immediately followed by scrutiny of platforms like Trading 212, which reportedly offered crypto ETNs to retail clients before securing the necessary bond-selling permissions, prompting the regulator to flex its muscles and enforce compliance. Industry analysts at IG have estimated that the legal introduction of crypto ETNs could expand the UK’s crypto market by as much as a fifth, highlighting a pent-up demand that regulators are now cautiously trying to manage.
