The UK government is reportedly planning to give the Bank of England a formal Bank of England digital assets mandate, requiring the central bank to actively support innovation in payment systems and digital currencies alongside its primary role of maintaining financial stability.
According to the Financial Times, the initiative would take the form of a “secondary objective” added to the BoE’s existing responsibilities. The main focus would be expanding the use of blockchain in financial services and payments, with tokenised deposits and the tokenisation of real-world assets also in scope. An amendment detailing the objective is expected to be introduced, with legislation set to be debated next month.
What the Amendment Would Actually Require
The mechanics matter here. According to CoinDesk, the secondary objective would be inserted through an amendment to the Financial Services and Markets Bill. Crucially, the BoE would not simply be nudged in a new direction and left to get on with it: the central bank would be required to report annually to Parliament on how it is advancing innovation in payment systems and digital money. That reporting requirement gives the mandate teeth. A duty to explain progress publicly is a different proposition from a general instruction to be more supportive.
Which leaves an obvious question: what counts as sufficient progress? The answer to that will likely only become clear once the BoE starts filing those reports and Parliament starts asking questions about them.
The Bank of England Digital Assets Mandate in Context
The BoE has faced criticism for what some view as a cautious stance on digital assets, even as blockchain, stablecoins and tokenisation have moved from experiment to something approaching infrastructure in parts of global finance. The secondary objective is framed as a corrective, a way of formally aligning the central bank’s incentives with the government’s broader ambition to position the UK as a global financial hub.
Payments modernisation has been building as a policy priority for some time. The BoE has already advanced initiatives aimed at moving the UK closer to round-the-clock financial settlement, including plans to extend the operating hours of Britain’s payment systems to cover Sundays and some bank holidays over the coming years. That is incremental reform. The digital assets mandate, if enacted, would push the BoE into more actively contested territory.
Payments sovereignty is the overarching theme running through these efforts. An industry group has been pursuing the creation of a domestic payments rail with the ambition of rivalling Visa and Mastercard at global scale. The secondary objective would, in theory, give the BoE reason to facilitate rather than observe that kind of initiative.
The EU has pursued similar instincts, connecting real-time payment systems and developing a central bank digital currency framework, but progress has often been slow and constrained by the complexity of coordinating across member states. The UK, operating outside that framework, has more freedom to move. Whether it moves faster is another question.
Stablecoins and tokenised deposits sit at the practical centre of the Bank of England digital assets mandate as described. Both have the potential to work across borders and at scale without requiring the full weight of a sovereign digital currency project behind them. The government’s framing suggests it sees them not as a speculative asset class to be managed but as infrastructure to be built.
The amendment still needs to clear Parliament, and secondary objectives have a history of meaning rather less in practice than they do on the day of announcement. What the annual reporting requirement does is create a mechanism for holding the BoE accountable to a specific agenda over time. That structural feature may prove more consequential than the objective itself.
