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Polygon Labs has been tapped to help the Bank of England figure out what a digital pound might actually look like in practice. The blockchain infrastructure firm is joining Phase 2 of the central bank’s Digital Pound Lab, where it will work alongside NOBO Finance Limited and Dun & Bradstreet to test onchain use cases focused on trade finance for small and medium enterprises.
The appointment, announced on August 12, represents one of the clearest signals yet that central banks aren’t just studying crypto infrastructure from a distance. They’re inviting it into the building.
What the Digital Pound Lab is actually testing
Phase 2 of the Lab, which runs approximately from November 2025 to July 2026, is designed to examine how private stablecoins and a central bank digital currency might interact in real-world payment scenarios. The key word there is “simulated.” No actual customers are involved, no real funds change hands. This is a sandbox exercise, not a product launch.
The consortium is tackling two distinct workstreams. The first focuses on building reusable credit profiles for SMEs, essentially creating portable financial identities that could follow a small business across different lenders and platforms. The second explores cross-border trade finance flows, testing invoice factoring scenarios where a digital pound and stablecoins would need to work together across jurisdictions.
Polygon’s contribution centers on its Open Money Stack, a suite of tools that handles stablecoin settlement, embedded wallets, and smart contract deployment. Dun & Bradstreet, the 183-year-old data analytics firm, brings commercial credit data to the table. NOBO Finance handles the trade finance modeling.
Why the Bank of England picked this fight
Phase 2 specifically emphasizes participant-defined applications. The Bank isn’t dictating what gets tested. It’s asking companies like Polygon to propose scenarios and then stress-testing them within its framework.
Marc Boiron, CEO of Polygon Labs, framed the collaboration in terms of interoperability.
“For digital currencies to effectively support global trade, public and private forms of currency must work seamlessly together.”
The stablecoin interoperability question
The most consequential piece of this experiment may be the interoperability testing between stablecoins and a simulated digital pound. Invoice factoring, where a business sells its unpaid invoices at a discount for immediate cash, is a particularly good stress test. It involves multiple parties, cross-border payments, credit assessment, and settlement timing, all areas where traditional finance moves slowly and expensively.
What this signals for the broader market
The SME credit profile workstream also deserves attention. Small businesses account for the vast majority of firms in most economies but remain chronically underserved by trade finance. The global trade finance gap, the difference between what SMEs need and what banks provide, runs into the trillions of dollars.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
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