Bank of England Advocates New Regulation for Stablecoins

Bank of England Governor Andrew Bailey calls for stablecoins in Britain to be regulated like traditional bank money. He acknowledges their increasing popularity but stresses the need for depositor protections and BoE reserve access. The BoE plans a consultation paper on the matter in the coming months.

The Bank of England is advocating for stronger regulation of stablecoins, aiming to treat them similar to money in a standard bank. Governor Andrew Bailey emphasized the need for depositor protections and access to BoE reserve facilities for stablecoins as they become more widely used in Britain.

Bailey, known for his cautious stance on cryptocurrencies, acknowledged the role of stablecoins in facilitating cryptocurrency trades but noted they do not yet serve as traditional payment means. The BoE plans to release a consultation paper on stablecoins later this year.

With stablecoins gaining popularity, especially following the U.S. GENIUS Act, the need for regulatory frameworks has become prominent. Industry figures have expressed concerns over proposed caps and backing asset criteria, but Bailey insists on insured, risk-free backing assets for greater stability and trust.