Bank of England to Launch Stablecoin Regulation Consultation in November

According to Cointelegraph, the United Kingdom's crypto trade association, CryptoUK, has expressed approval of the Bank of England's (BoE) plans to initiate a consultation on stablecoin regulation in November. The association believes that aligning with the United States' policy on stablecoins would bolster confidence in the UK's digital asset industry. A spokesperson from CryptoUK emphasized that adopting a similar approach to the US would enhance industry confidence and ensure the UK remains competitive globally. The spokesperson highlighted the importance of keeping pace with the US and other jurisdictions, noting the global nature of the crypto industry and the rapidly shifting competitive landscape. The Bank of England aims to establish new stablecoin regulations by the end of 2026, as reported by Bloomberg. The central bank plans to commence a consultation on November 10, proposing a framework modeled closely on US regulations. Anonymous sources cited by Bloomberg indicate that the BoE is keen on ensuring the UK's regulatory framework aligns with the US, where stablecoin legislation is advancing. The proposed rules may require issuers to hold government bonds or bills with maturities, reflecting US standards. This initiative comes amid pressure from the UK Treasury, which has urged the central bank to act swiftly to prevent the country from losing ground to other jurisdictions. BoE Governor Andrew Bailey has acknowledged the potential role of stablecoins in modern payments, suggesting a shift in the bank's stance toward digital assets. The move towards a stablecoin framework is part of a broader trend towards a more crypto-friendly environment within the UK's financial sector. On October 9, the Financial Conduct Authority (FCA) lifted its four-year ban on crypto exchange-traded notes (ETNs), enabling investors to access digital assets through regulated platforms like the London Stock Exchange. This decision was followed by asset manager BlackRock launching its Bitcoin exchange-traded product (ETP) in the UK. Additionally, the FCA has authorized asset managers to utilize blockchain for fund tokenization, aligning with the government's vision of transforming the UK into a hub for tokenized finance. These developments indicate that the UK is moving towards an innovation-friendly and regulated model, aiming to attract crypto capital and compete with other jurisdictions.