The Department of the Treasury of the U.K. has revealed that it’s drafting proposals to manage private stablecoins, while also researching CBDC as an alternate to cash.
Within an official announcement published recently on 9th Nov., U.K. Treasury Chancellor Rishi Sunak added that the upcoming regulatory proposals alongside other goals for the nation’s financial services businesses – including a review of the U.K.’s listings regime and support for green finance.
“New technologies like stablecoins – privately-issued virtual assets – could transform the way people store and exchange their money, making payments cheaper and faster.”
The news comes amid every week of decisive negotiations between the U.K. and therefore the European Union over a post-Brexit trade deal. Chancellor Sunak added that he hopes the U.K.’s financial services sector will lead “the global conversation on new technologies like stablecoins and CBDCs” moving forward:
“We are starting a new chapter within the history of monetary services and renewing the UK’s position because the world’s pre-eminent center […] Our plans will make sure the UK moves forward as an open, attractive and well-regulated market.”
While details are scant, the announcement asserts the draft guidelines would require stablecoin initiatives to abide by an equivalent minimum standard as entities operating with other methods of payment.
The document also added that both England’s central bank and treasury are presently researching a CBDC, with the Chancellor welcoming work from the 2 departments into “whether and the way central banks can issue their own virtual assets as an alternative to cash.”
The regulatory implications of stable tokens became a serious topic of concern following Facebook’s announcement of its decision to launch its virtual currency Libra earlier in June last year.
Since then, European lawmakers have consistently involved the event of strict and clear regulatory guidelines before allowing private stablecoins to require root within their jurisdictions, emphasizing concerns surrounding monetary sovereignty as well as user safety.
Moreover, the U.K. Treasury’s Chancellor appears to possess made a way more level-headed assessment of the burgeoning stablecoin sector, adding that stable token initiatives will face an equivalent oversight as existing payments firms.