In the last month, the UK has made bold strides in digital asset innovation, particularly in tokenization. With ambitious government-backed initiatives and industry-led breakthroughs, the country is positioning itself as a global leader in modernizing financial markets through blockchain technology. From tokenized money market funds to pilots for digital sovereign debt, the momentum is undeniable.
Landmark Collaboration on Tokenized Money Market Funds
In early November 2025, Global Digital Finance (GDF), in partnership with Ownera, EY, and Hogan Lovells, released a groundbreaking report: “The Case for Collateral Mobility in Europe & The UK using Money Market Funds (MMFs)”. This cross-industry effort involved over 70 major firms, including BlackRock, JP Morgan, Goldman Sachs, State Street, Franklin Templeton, Archax, and Aberdeen Investments.
The report examined legal certainty and operational readiness for tokenized money market funds (TMMFs) as collateral in Luxembourg, Ireland, and the UK. Key findings highlighted high certainty in Luxembourg and low uncertainty in the UK and Ireland, with sandbox simulations demonstrating how tokenization can streamline settlement and enhance collateral mobility.
Sharon Lewis, Co-Chair of Hogan Lovells’ Digital Assets & Blockchain Practice, emphasized: “There is relative legal certainty of TMMFs located in Luxembourg… where both Ireland and the UK have a low degree of uncertainty as the courts are likely to treat digitally native TMMF shares in a manner consistent with traditional shares.”
Notable real-world progress includes Aberdeen Investments’ tokenized money market funds, which have been used in innovative trades, such as FX collateral swaps with Lloyds Banking Group via Archax on Hedera.
Government Accelerators: Digital Markets Champion and the DIGIT Pilot
The UK government is accelerating wholesale market digitization. In October 2025, Economic Secretary to the Treasury Lucy Rigby announced the creation of a Digital Markets Champion role to coordinate private-sector tokenization efforts under the Wholesale Financial Markets Digital Strategy.
Complementing this is the Digital Gilt Instrument (DIGIT) pilot, a digitally native sovereign debt instrument using DLT within the Digital Securities Sandbox (DSS). The DIGIT pilot advanced with the launch of its procurement process in March 2025 (seeking industry input on DLT solutions) and a key progress update in July 2025. The pilot aims to test on-chain issuance, settlement, and interoperability, catalyzing broader DLT adoption.
Meanwhile, the UK is preparing for T+1 settlement by October 2027, aligning with the EU and enhancing efficiency in tokenized environments.
Exclusive Insights: John Salmon on Blockchain’s Transformative Future
We spoke to John Salmon, Partner and Global Co-Head of Digital Assets & Blockchain at Hogan Lovells, just before Christmas 2025, to find out more.
John has worked for 30 years in the legal profession, starting in Scotland with insurance, then evolving into fintech and digital assets since 2015. Today, he leads an institutional-focused practice advising global banks, exchanges, and tech firms on regulatory strategy.
On the UK’s progress to clarify regulation, John shared how: “The work that the UK has done has been fantastic… the quality of research and thought and effort that’s put in, you can’t really knock. They have spent a lot of time and effort on it.”
John believes that in five years, the financial markets infrastructure will be very different from what it is today. He is a strong advocate of blockchain technology, which he sees playing a vital role in this change.
Hogan Lovells’ Frontline Contributions: From Reports to Global Expertise
We discussed the recent report co-authored with EY, Ownera and GDF. John shared how “we absolutely believe that the tokenization of money market funds is a very exciting development which will be a key trend in 2026.”
“All our clients are looking at this. I would see the two big things on our radar [as] digital programmable money… and tokenized money market funds.”
Regarding broader initiatives like the DSS: “It’s a great idea… they are taking on feedback… I’d rather things were moving in the right direction.” John added how, during his interactions with the DSS, he saw an approach that creates ‘enablement’ for people to get on with their projects. This is key to ensuring that things are moving.
Hogan Lovells has also added Senator Kyrsten Sinema as a senior advisor to the firm. The former senator is also a member of Coinbase’s Global Advisory Council and knows the ins and outs of Washington’s political and regulatory process.
Fresh Momentum: The Hogan Lovells and TheCityUK Progress Report
Here in London, Hogan Lovells works with TheCityUK, an industry-led body representing UK-based financial and related professional services. The two organizations recently submitted a progress update about “Implementing the recommendations of our ‘Digitalisation of UK capital markets’ report.”
The report frames digitalisation as “essential for the future competitiveness” of UK markets, warning that other countries are “rapidly developing coherent policies to position themselves as frontrunners.”
It positions the UK at a “crossroads” with “welcome step change” momentum but calls to “act with urgency and purpose” to unlock efficiencies and maintain leadership in global finance.
Global Comparisons: MiCA Challenges vs. UK-US Interoperability Hopes
On MiCA’s challenges versus the UK’s approach: John noted MiCA’s implementation hurdles, including uneven national adoption and political variances. This is in contrast with the UK’s collaborative, high-quality policymaking involving the Treasury, the FCA, and the Bank of England.
Looking ahead: “By the end of next year, we will have a regime… it will be a lot better than MiCA, and it will probably be in before the US regime… Importantly, it will be clearer for institutions.”
He stressed the need for interoperability with the U.S. and EU on stablecoins and tokenized deposits. From an institutional perspective, it is key to have these regulatory frameworks in line with each other. The more they differ, the more work this adds for banks and fintechs.
Case Study: Exodus Management Acquisition of Monavate and Baanx
John also discussed Hogan Lovells’ role in high-profile deals, such as advising Exodus Movement on its $175 million acquisition of Monavate and Baanx. The acquisition brought together innovative capabilities across fintech and digital assets, enabling seamless non-custodial crypto spending. John was very positive about the deal, which he emphasized brought a real use case to digital assets. It allows consumers to pay for their everyday goods using a non-custodial wallet.
Monavate holds an Electronic Money Institution (EMI) license in the UK, with EU coverage and a VASP license in Portugal.
A Hub Poised for Leadership
John remains optimistic: “Our clients regard the UK as an important hub for digital assets from a commercial point of view.”
He also added how there is every chance that “we will have one of the most attractive regimes in the world by the end of next year.”
The UK’s pragmatic, industry-driven approach, coupled with initiatives like the Digital Markets Champion, DIGIT, and robust tokenization pilots, is fostering a safe, innovative ecosystem. As global competition heats up, the UK is not just keeping pace; it’s setting a compelling standard for institutional digital assets.
Author: Andy Samu
The editorial team at #DisruptionBanking has taken all precautions to ensure that no persons or organizations have been adversely affected or offered any sort of financial advice in this article. This article is most definitely not financial advice.
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Why Singapore’s Crypto Regulation Is Outshining MiCA in 2025 | Disruption Banking
