HM Treasury sets Q1 2027 for first Digital Gilt Instrument issuance and prepares further deals via HSBC and LSEG link

HM Treasury published an update on the pilot Digital Gilt Instrument issuance, confirming that the first DIGIT transaction is due to take place by Q1 2027 on HSBC Orion, HSBC’s digital securities depository. The government is also taking steps to prepare for potential further DIGIT issuances, subject to the success of the pilot, and has advanced plans to support interoperability, investor access and a possible exchange listing. A memorandum of understanding between HSBC and London Stock Exchange Group would create a bilateral link between HSBC Orion and LSEG’s digital securities depository, allowing investors to access and hold DIGIT through either infrastructure. Under that model, LSEG’s platform would act as an investor depository for settlement and asset servicing, alongside HSBC Orion as the issuer depository. HM Treasury also said it has engaged with regulators and LSEG on a potential listing and expects DIGIT to be listed on the London Stock Exchange’s main market as part of the pilot issuance. Separately, HSBC received Gate 2 approval in the Digital Securities Sandbox on 13 July, making it the first sandbox entrant approved to provide live digital securities depository services. HM Treasury also intends to lay legislation, when parliamentary time allows, to amend the Digital Securities Sandbox framework. The changes are intended to support digital securities depository services and digital security issuances, including DIGIT on Digital Securities Sandbox-authorised distributed ledger technology platforms.