ClearToken Clears Gate 2 in Bank of England Sandbox

ClearToken has cleared Gate 2 in the Bank of England's Digital Securities Sandbox (DSS), allowing it to operate a digital securities depository. This milestone enables ClearToken to issue and settle tokenized versions of existing securities under Bank supervision, within set limits. The firm is now the second entity through Gate 2 and the first non-bank to achieve this status.

The approved infrastructure covers tokenized equities, corporate bonds, and sovereign debt, with live services at launch covering FTSE 350 equities, GBP government debt, and GBP and non-GBP corporate bonds. These securities can be used as collateral for securities financing transactions. ClearToken emphasizes the focus on collateral mobility rather than issuance.

Settlement runs continuously, removing batch processes and end-of-day cut-offs. This enables intraday repo on a 24/7 basis, allowing participants to borrow against collateral for hours instead of days. The firm claims this increases efficiency in securities financing transactions.