Overview

• Andrew Bailey wrote in the Financial Times that it would be wrong to oppose stablecoins on principle and that the UK should reap their benefits.
• The forthcoming consultation will propose that widely used UK stablecoins be regulated like bank money with access to Bank of England accounts and reserve facilities.
• Bailey outlined expected safeguards for systemic tokens, including fully risk‑free backing assets, insurance and resolution arrangements, and convertibility to cash without relying on crypto exchanges.
• Industry groups welcomed the softer tone, with Innovate Finance calling it a positive step, while warning that potential holding caps, interest rules on backing assets and coverage criteria could curb innovation and competitiveness.
• Bailey signaled that money and credit provision could be partially separated to allow banks and regulated stablecoins to coexist, a shift from his earlier skepticism as other jurisdictions, including the U.S. under the GENIUS Act, lock in stablecoin frameworks.