UK mulls granting Bank of England more power in stablecoin regulation

The consultation paper explains that the BOE could take on “prudential matters,” and the FCA could head up conduct


UK Prime Minister Rishi Sunak | ComposedPix/Shutterstock modified by Blockworks


The UK Treasury penned a consultation paper on stablecoins, outlining how it’s considering approaching stablecoin regulation.

The government is considering tapping the Bank of England to oversee stablecoins alongside the Financial Conduct Authority (FCA). The consultation paper comes after the government sought feedback from respondents — including PayPal, HSBC UK, Circle and Barclays.  

The Treasury found that the Banking Act of 2009 gives the BOE enough of a regulatory perimeter to oversee stablecoins, though it noted that it will “further clarify the Bank’s existing regulatory toolkit.”

“A clear majority agreed with the government’s principles to reforming this perimeter to ensure that the Bank’s capacity to mitigate acute financial stability risks kept pace with the evolution of the payments sector at large,” the UK government said.

The paper lays out the groundwork for what could be expected of the BOE if it’s put in charge of stablecoins. The Bank would take point on “prudential matters,” while the FCA would head up conduct. 

However, “the Bank would be given the power to prevent the FCA from taking action in relation to an entity recognised as systemic” and the Prudential Regulation Authority could step in if any FCA actions caused concern around financial stability.

According to the paper, the government will push the BOE to supply details on how it will regulate newer technologies, though it also notes that the power shouldn’t then be applied to entities that are already supervised by the bank. 

“The government also recognises that limits might be set to mitigate broader financial stability risks, such as the financial and monetary stability risks posed by new forms of digital money such as stablecoins,” the paper said.

The Bank of England has been conducting stablecoin and distributed ledger technology research, with the BOE finding that stablecoins offer “efficiency” in payments earlier this year.

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.


Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research



Aerodrome is a "MetaDEX" that combines elements of various DEX primitives such as Uniswap V2 and V3, Curve, Convex, and Votium. Since its launch on Base, it has become the largest protocol by TVL with more than $495M in value locked, doubling Uniswap's Base deployment.


Scientific reputation should be determined by a decentralized community of scientists, not the validation of higher institutions


Paxos is getting off scot-free after the SEC said it wouldn’t pursue legal action against the company


The Srcful partnership is part of a broader plan to onboard Helium “subnetworks”


Plus, a look into US spot BTC funds six months into trading


A Swedish energy-focused project named Srcful proposed to become a Helium subnetwork with its own ENERGY token


Securitize CEO Carlos Domingo thinks BUIDL will potentially hit its next $500 million milestone in just a few months