Bank of England Launches DLT Trial for RTGS System
The Bank of England has launched a distributed ledger technology trial with 18 firms, including major banks and financial infrastructure providers. The experiment aims to modernize its real-time gross settlement (RTGS) infrastructure, a core component of the UK's financial system. This initiative signals a move toward integrating blockchain-based systems with foundational financial plumbing.
- This initiative, formally named the "Synchronisation Lab," will run for six months to test how tokenized assets can settle atomically against central bank money. No real funds will be used in the experiment. - Key crypto-native participants include Chainlink, which is testing a decentralized solution for settling tokenized securities against a CBDC. Other notable firms involved are Swift and the London Stock Exchange Group (LSEG), focusing on use cases like tokenized government bonds and foreign exchange settlement. - The trial is a continuation of previous Bank of England explorations into DLT, including "Project Meridian," which demonstrated how tokenization projects could achieve atomic settlement synchronized with the RTGS system. Another related initiative was "Project Rosalind," a collaboration with the Bank for International Settlements that explored APIs for a retail CBDC. - The technology partner Quant provided the underlying blockchain platform and smart contracts for Project Rosalind, focusing on the interoperability of central bank ledgers. - The underlying RTGS system is a critical piece of UK financial infrastructure, settling an average of over £800 billion each working day. In 2025, the system processed a record 53.3 million transactions, totaling £93.9 trillion for the year. - This experiment is part of a broader, multi-year RTGS Renewal Programme. The core settlement engine was upgraded in April 2025, a move that enables greater interoperability with new technologies like DLT and provides enhanced API access. - The Bank of England has stated that while it doesn't believe DLT is mature enough to form the core of the next-generation RTGS, ensuring interoperability is a high priority. The long-term vision includes potentially extending RTGS operating hours to nearly 24/7, which would better align with global crypto market activity. - The trial will explore two primary settlement models: one where "synchronisation operators" issue settlement instructions and another where RTGS account holders send the instructions directly. This is designed to test different levels of decentralization and control in a future tokenized environment.
