The Deputy Governor of the Bank of England has affirmed that it will deploy a stablecoin legal framework in parallel with the US, amid the booming $310 billion market.
The Bank of England has pledged to roll out stablecoin regulation at the same pace as the United States, allaying concerns that the UK is lagging behind its allies in the global race to regulate digital assets. Deputy Governor Sarah Breeden stressed at the SALT conference in London on Wednesday that policy synchronization between London and Washington is crucial to governing the $310 billion stablecoin industry.
Ms. Breeden confirmed that British regulators are working closely with their US counterparts, including the Federal Reserve, while the Bank of England is set to publish a consultation paper on stablecoins on November 10. The statement comes after the US passed the landmark GENIUS Act in July, which creates a clear legal framework for stablecoins and puts pressure on other countries to modernize their regulatory regimes.
The Deputy Governor’s remarks follow a momentum for cooperation that was reinforced after a meeting between UK Finance Minister Rachel Reeves and US Treasury Secretary Scott Bessent in September, when the two sides agreed to step up cooperation in the digital asset sector. UK blockchain advocacy groups have previously called for a more open approach from the government, arguing that the current cautious policy is stifling innovation and costing the country its competitive edge.
UK's global competitive pressure increases
The Bank of England faced fierce criticism in late 2023 when it proposed limiting the amount of stablecoins an individual could hold to 10,000 to 20,000 pounds, or $13,050 to $26,100. The proposal was deemed difficult and expensive to implement, reflecting the regulator's hesitation to balance innovation with risk control.
Canada is also joining the stablecoin regulation race. The government on Tuesday announced plans to create a regulatory framework that requires issuers to be backed by fiat assets, maintain adequate reserves and implement rigorous risk management measures. The move is part of a strategy to modernize the national payment system, which serves more than 41.7 million Canadians with faster, cheaper and more secure digital transactions.
The adoption of stablecoins in the institutional financial sector is growing rapidly. Corporations such as Western Union, SWIFT, MoneyGram and Zelle have all integrated or announced plans to integrate stablecoin payment solutions in recent months. The global stablecoin market could reach $2 trillion by 2028, according to estimates from the US Treasury Department in April, marking one of the fastest-growing segments of the global digital asset ecosystem.
