In a groundbreaking move for the UK financial sector, Lloyds Banking Group and Aberdeen Investments have executed the country’s first foreign exchange trades collateralized with tokenized real-world assets, leveraging blockchain technology in a pilot with UK-regulated crypto exchange Archax.
Announced on Monday via Bloomberg, the pilot involved digital tokens representing Aberdeen’s money market fund and UK government bonds (gilts). These assets were tokenized, transferred, and held securely through Archax’s platform on the Hedera Hashgraph blockchain.
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Digital Assets Breakthrough: UK Pioneers Tokenized Trading with Hedera Hashgraph
In a groundbreaking move, Aberdeen Investments, Lloyds Banking Group,… pic.twitter.com/NNSwJUM8O6
— Crypto Observer (@DJ_Bax01) July 14, 2025
Peter Left, Lloyds’ head of digital finance, highlighted the significance of the pilot in demonstrating that regulated financial institutions can use digital assets as collateral without needing to overhaul existing legal frameworks.
“Digital assets can be used in regulated financial markets under existing legal frameworks here in the UK,”
he said, adding that blockchain infrastructure brings enhanced collateral efficiency and reduces operational bottlenecks.
The initiative marks another step in the industry-wide push to modernize collateral systems using blockchain and tokenization to streamline settlement processes. In 2023, J.P. Morgan partnered with BlackRock and Barclays via its Onyx Digital Assets platform to transfer tokenized money market fund shares as collateral for derivatives trades, completing settlements in minutes rather than days.
Similarly, Finality – backed by major banks such as Lloyds, Santander, and UBS – piloted a blockchain-based solution enabling intraday settlement of margin calls using tokenized central bank money, with funds held via an omnibus account at the Bank of England.
Globally, momentum around tokenized financial systems continues to build. Singapore’s central bank recently collaborated with ISDA and Ant International to pilot the use of tokenized bank liabilities and deposits for cross-border FX settlement, illustrating how blockchain can accelerate international financial transactions.
Meanwhile, Mitrade, a globally recognized Contract for Difference (CFD) trading platform, introduced an Excess of Loss Insurance Policy backed by Lloyd’s of London in January, offering up to AUD 1 million in coverage for claims due to company insolvency, aimed at enhancing trader confidence in Australia’s retail trading market.
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