The UK Treasury has proposed a five-year period of lighter regulations for digital bonds and equities, as part of a new "sandbox" for innovative securities based on distributed ledger technology (DLT). The government hopes that this will make markets more efficient, transparent and resilient.

The relaxation of regulations will initially apply to digital equities, bonds and money market instruments, but not to derivatives or unbacked crypto. The Treasury is seeking feedback on its plans for a digital securities sandbox until August 22.