An executive at crypto firm Circle said UK regulators could enact stablecoin legislation in the coming months.
Stablecoins have exploded onto the digital asset scene in recent years, led by Tether’s USDT and Circle’s USDC. However, UK regulators have been slow to publish stablecoin-specific rules.
After meeting with Bank of England officials, Dante Disparte, Circle’s global head of policy, was reassured by their digital asset strategy. Disparte told CNBC that UK stablecoin legislation could be enacted within “months, not years.” There was no immediate comment from the Bank of England or the UK Treasury.
Cryptographic resistance
The UK lags behind the European Union in building a regulatory framework for cryptocurrencies. The EU’s Markets in Cryptoassets (MiCA) regulation is expected to come into force by the end of the year. MiCA is a comprehensive set of rules for crypto and digital assets, and includes regulations specific to stablecoins.
The UK is less keen on establishing a similar framework for cryptocurrencies. According to Disparte, much of the resistance to cryptocurrencies in the UK stemmed from concerns following the collapse of crypto platform FTX and concerns about fraud and risk.
“If you look back, a lot of people in the UK and other countries, because of all the problems we’ve seen, jumped right in and completely regulated and didn’t bring the environment onto land. “I think we’re justified in saying that the last few years have been instrumental in the development of cryptocurrencies,” Disparte said.
future money
Many stablecoins track fiat currencies on a one-to-one basis, so they don’t have as much volatility and risk as other cryptocurrencies. As stablecoin use cases expand, major players in the payments industry have invested in the technology. PayPal launched the PayPal USD stablecoin earlier this year, and Stripe just made a $1 billion investment in stablecoin specialist Bridge.
The proven capabilities of this technology mean that the UK could miss out on the benefits of stablecoins if it does not build the infrastructure for them.
“In the spirit of protecting the UK economy from too much risk and cryptocurrencies, there is a point at which it ends up protecting the economy from job creation and future industries,” Disparte said. “If we don’t have the money of the future, we can’t have the economy of the future.”
