UK names six banks for its first digital gilt, DIGIT pilot due by early 2027

Britain's plan to sell a government bond that lives entirely on a distributed ledger has moved a step closer. HM Treasury said on 6 October that it has appointed six banks as joint lead managers for the pilot issue of DIGIT, the Digital Gilt Instrument: Barclays, HSBC, Lloyds, Morgan Stanley, NatWest and RBC Capital Markets.

The appointments were announced by Lucy Rigby, the Economic Secretary to the Treasury, in her keynote opening UK Digital Assets Week in London that morning. The Treasury expects the pilot issue to take place by the first quarter of 2027.

What DIGIT is

A gilt is a bond issued by the UK government. DIGIT is described as "digitally native", meaning it is created and recorded on distributed ledger technology from the start rather than being a digital copy of an ordinary bond. According to the Treasury, the pilot will be short-dated, issued on a platform operating inside the Digital Securities Sandbox, settled on-chain and kept separate from the government's main debt management programme.

HSBC was picked as the DLT supplier in February, and DIGIT will be issued on its Orion platform. In July HSBC and the London Stock Exchange Group signed a memorandum of understanding to build a bilateral link between their digital securities depositories, so that investors can reach DIGIT through either system. Rigby said the government intends to list DIGIT as the first digital asset on the LSEG main market.

The six banks will do what lead managers do on any gilt sale: underwrite, sound out investors and distribute the bond on issue day. Their appointment completes the procurement, which the Treasury said will allow investor engagement to begin. "The appointment of Lead Managers marks an important step as we work towards issuance early next year," Rigby said in the Treasury's statement.

Why the Treasury is doing it

The government lists two aims for the pilot. One is to test how DLT can be used in issuing UK sovereign debt. The other is to help build DLT infrastructure in the UK and encourage its use across financial markets. Rigby said the Treasury is also preparing for possible further issues, depending on how the first one goes.

In the speech she said the sandbox is now moving from tests to live activity. In July HSBC became the first firm approved to run a live Digital Securities Depository in the sandbox, and ClearToken has since become the second. The government intends to lay secondary legislation over the coming months to support digital services and issuance in the sandbox.

Where the UK's crypto and stablecoin rules stand

Rigby used the same speech to set out how far the wider crypto regime has come. Regulations she took through in February bring a broad range of cryptoasset activity inside the Financial Conduct Authority's perimeter from 25 October 2027. The FCA published final rules in June covering stablecoin issuance, regulated crypto activities and prudential requirements, and last month it issued final perimeter guidance. The window for firms seeking the transitional arrangements opened on 30 September, as we reported when the FCA opened its authorisation window.

In September the Treasury also laid legislation making targeted changes to the cryptoasset regulations for firms that provide stablecoin payment services. The government is consulting separately on reforms to payments law, including bringing UK-issued stablecoins inside the payment services perimeter. Rigby said the amendments mean firms will not have to get cryptoasset permissions now only to apply again once the payments reforms arrive.

She added that the UK is working with the United States through the Transatlantic Taskforce on "appropriate alignment" on stablecoins, and that the government is considering how to use its powers to create overseas recognition regimes for digital assets. On the American side, regulators are writing their own rulebook, including a CFTC consultation on leveraged retail crypto trading.

A wholesale experiment

DIGIT is a pilot for the professional bond market. The Treasury's material talks about underwriting, investor engagement and market infrastructure, and says nothing about a sale to individual savers. What makes it worth watching from India is that a G7 government is putting a slice of its own borrowing on ledger-based infrastructure and wiring it into a main stock exchange listing. The UK holds the G20 presidency in 2027, and Rigby said avoiding fragmented digital markets would be part of that agenda.

Names, dates and quotes in this report are from HM Treasury's announcement and the transcript of the Economic Secretary's speech, both published on 6 October 2026.