• Major UK banks have completed the first live customer transactions using tokenized sterling deposits on shared infrastructure.
• Participants include Barclays, HSBC UK, Lloyds Banking Group, Monzo, Nationwide, NatWest and Santander.
• The project is using real commercial-bank money and is testing payments including person-to-person transfers and remortgage transactions.

**ID:** B25-09

**Site:** Bitcoinist

**Status:** READY

**Author:** Bitcoinist Editorial Team

**Focus Keyword:** Tokenization

**Image Keyword:** Sterling

**Category:** Technology

**Tags:** UK Finance, Tokenized Deposits, Sterling, Banks, Payments

**Primary Source:** https://www.ukfinance.org.uk/news-and-insight/press-release

The Money Is Still A Bank Deposit

That distinction is central to the project.

A tokenized deposit is not a privately issued stablecoin and it is not a digital pound issued by the Bank of England.

It is a digital representation of money already held as a commercial-bank deposit.

The aim is to retain the legal and regulatory protections attached to ordinary bank money while adding blockchain-style programmability and faster settlement.

Banks participating in the project include Barclays, HSBC UK, Lloyds Banking Group, Monzo, Nationwide, NatWest and Santander.

Quant built the platform, while EY is providing project management and Linklaters developed legal advice and the rulebooks.

The Pilot Is Testing Real Consumer And Financial Use Cases

The project includes person-to-person transfers and remortgage transactions.

UK Finance says digital-asset settlement will also be tested over the coming months.

That makes the experiment broader than sending a token from one test wallet to another.

The industry is trying to show that tokenized bank money can work across institutions and support transactions customers already understand.

Interoperability is the harder part.

Individual banks can build tokenized deposit systems relatively easily.

The real value emerges when a deposit issued by one institution can move across common infrastructure without breaking the protections or controls associated with the banking system.

The project is therefore a useful counterpoint to stablecoins.

Stablecoin companies are increasingly trying to make blockchain dollars look more like regulated bank money.

Banks are moving in the opposite direction, trying to make regulated deposits gain the programmability of blockchain assets.

The two models may eventually meet somewhere in the middle.

For now, the UK pilot shows tokenized deposits moving beyond demonstrations.

Actual customers have now used them to complete live sterling transactions.

*This article was written by the News Desk and edited by [Samuel Rae](https://bitcoinist.com/author/samuelrae/).*

TL;DR

• Kamino has opened a lending market for tGBP, a British-pound stablecoin issued by BCP Technologies.
• Users can supply tGBP or borrow it against collateral including USDC, cbBTC and JitoSOL.
• The market is curated by Steakhouse Financial and creates sterling-denominated credit on Solana.

Dollar stablecoins dominate DeFi, but Kamino is adding a different currency to the mix.

The Solana lending protocol has opened a market for tGBP, allowing users to borrow or supply a stablecoin designed to track the British pound.

The market is curated by Steakhouse Financial.

Sterling Can Now Be Borrowed Against Crypto Collateral

BCP Technologies issues tGBP as a token intended to track the pound on a one-to-one basis.

The firm is registered as a cryptoasset business with the U.K.’s Financial Conduct Authority.

On Kamino, users can supply tGBP to the lending market or borrow sterling-denominated liquidity against supported collateral including USDC, cbBTC and JitoSOL.

That creates a use case DeFi has historically struggled to serve.

A British user or business may want to borrow in pounds because its expenses and accounting are denominated in pounds.

Borrowing a dollar stablecoin instead introduces foreign-exchange exposure on top of the underlying loan.

A GBP-denominated market removes part of that mismatch.

DeFi Is Still Heavily Dollarized

The launch does not suddenly make sterling a major onchain currency.

Dollar stablecoins remain vastly larger and more liquid across crypto markets.

That liquidity advantage reinforces itself.

Borrowers want the assets with the deepest markets, while lenders prefer pools where there is consistent demand and easy exit liquidity.

Building a non-dollar lending market therefore requires more than creating the token.

It needs enough lenders and borrowers to keep rates competitive and liquidity usable.

Kamino’s tGBP market is a relatively small step, but it points toward a more mature version of onchain credit.

Real financial systems operate in many currencies.

If DeFi is going to serve businesses and users outside dollar-centric crypto trading, borrowing in local currencies has to become normal rather than unusual.

Sterling is now one more option on Solana.

The next test is whether users actually choose to take debt and earn yield in pounds when dollar liquidity remains so much deeper.

This article was written by the News Desk and edited by Samuel Rae.