Liquida passes Gate 1 of the Bank of England and FCA's Digital Securities Sandbox
A major milestone in Liquida's mission to build a next-generation repo market, aimed at giving institutions access to GBP liquidity against UK government bonds, 24/7.
Giltsmiths Limited, trading as Liquida, has passed Gate 1 of the Digital Securities Sandbox (DSS), jointly operated by the Bank of England and the Financial Conduct Authority (FCA). The Bank of England has published the company's Sandbox Approval Notice, confirming its admission as a sandbox entrant.
The milestone advances Liquida's mission to build a next-generation repo market: tokenising UK government bonds, known as gilts, so institutions can access GBP liquidity against their holdings around the clock.
Putting UK gilts to work around the clock
UK government bonds sit at the heart of institutional finance. Liquida's ambition is to make that collateral more useful in an increasingly digital financial system, connecting gilt holdings to on-chain borrowing and lending.
The proposition is straightforward: institutions should be able to raise sterling against their gilts when they need it, without selling the underlying assets. Liquida is building towards a market that operates beyond traditional banking hours, giving institutions greater flexibility over their liquidity while retaining their gilt holdings and the income they generate.
For banks, asset managers and other institutional holders, this could create a more flexible way to manage cash needs against existing assets. For liquidity providers, it could open a new channel for lending against UK government bond collateral.
Building a market for institutional use
Liquida is developing the infrastructure to connect tokenised gilt holdings with institutional custody, market pricing and controlled access for eligible counterparties. The aim is to make borrowing against gilts a practical treasury tool that institutions can integrate into their operations.
The next phase will focus on end-to-end non-live testing and developing pilot plans with prospective institutional participants. That work will test how assets, collateral valuations and liquidity flows connect in practice, while preparing the operational framework for Gate 2.
Dewi Perrin, Co-founder and Managing Director of Liquida, said:
"High-quality collateral should be useful whenever an institution needs liquidity. We are building Liquida so institutions can put their UK government bonds to work around the clock, without having to sell the assets.
"Passing Gate 1 is a major milestone for us. It gives us a clear next stage: test the infrastructure, work with institutional participants and demonstrate how tokenised gilts can support a more accessible market for sterling liquidity."
Progressing through the sandbox
The DSS provides a framework for developing the use of new technologies in financial market infrastructure. At Gate 1, Liquida can test its systems in a non-live environment. Live DSS activity requires Gate 2 approval and an updated Sandbox Approval Notice.
Liquida's entry and approval notice are available on the Bank of England's Digital Securities Sandbox dashboard.
Work with Liquida
Liquida welcomes discussions with institutions interested in participating in non-live testing and shaping future pilot activity, including prospective borrowers and liquidity providers.
To explore a pilot or discuss how gilt-backed liquidity could fit your organisation, contact the Liquida team.
About Liquida
Liquida is a UK financial technology company building a next-generation repo market for institutional borrowing and lending against tokenised UK government bonds. Its mission is to unlock GBP liquidity, 24/7, without requiring institutions to sell their underlying gilt holdings.
Liquida is the trading name of Giltsmiths Limited.
Read About Us or meet the team.
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