The U.K. Treasury is planning legislation to establish a regulatory system for stablecoins, to come as early as August, Coindesk reported Wednesday (July 6).
This comes in the form of a partnership with the Bank of England (BoE), the Payment Systems Regulator (PSR) and the Financial Conduct Authority (FCA), and other regulatory bodies.
Deputy BoE Governor Jon Cunliffe, speaking at the Qatar Centre for Global Banking and Finance’s annual conference, said the plans have been delayed by “recent events” which could refer to the resignations of numerous government officials in the country, including Treasury chief Rishi Sunak and senior Treasury official Jon Glen.
This comes after an April consultation on the subject, when the Treasury said the government planned to regulate that sector with the 2017 Payment Service Regulations, Financial Services Act and the 2011 Electronic Money Regulations Act. There were supposed to be more details coming.
There will also likely be more plans coming outside of the U.K., Cunliffe said, as the committee on payments and market infrastructures, the international panel he chairs, will look into worldwide standards for systemic payment systems in the next few months.
Some of the issues they want to look into include determining which assets should back these stablecoins, what should the redemption or claim be and how would one ensure such a coin is safe?
The question of how to regulate digital assets has been a pressing one all over the globe, with the U.S. Department of Commerce (DOC) launching a consultation to get feedback on a regulatory system. This came after President Biden’s executive order for crypto assets from March.
The results from the consultation show that respondents wanted regulatory clarity and a level playing field, and a new infusion of talent and education.
And there’s been agreement about the need for a retail CBDC, though the government says it might not be needed with other alternatives, and the banking sector said there were “serious concerns” due to risk and how the banking system will shoulder the costs for things like customer identification.
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