The United Kingdom has announced it will soon be regulating stable coins and that it’s looking to broaden those regulations to include bitcoin and more standard versions of crypto in the future.
The UK Is Planning to Regulate All Stable Coins
Economic Secretary to the Treasury John Glen made the announcement in a recent speech at the Innovate Finance Global Summit. He commented:
I can confirm that we will be legislating to bring certain stable coins into our payment framework… creating the conditions for stable coin issuers and service providers to operate and grow in the UK. This will also enable consumers to use stable coin payment services with confidence… and the government will introduce this legislation as part of an ambition to deliver a world-leading regulatory regime for stable coins.
Stable coins have long been popular amongst both crypto and traditional asset holders. While they are considered new forms of cryptocurrency, they are often tied to fiat assets such as the yen, the dollar, and the euro which prevents them from experiencing the volatility that often comes with bitcoin, Ethereum, and many standard forms of digital currency. Thus, they are widely considered primary points of any portfolio as they help to offset the effects of everyday digital assets.
By regulating stable coins, the United Kingdom says they can be used as methods of payment for goods and services, which ultimately boosts the initial goals of cryptocurrency and pushes the space even further. Initially, many forms of crypto were designed to serve as payment tools that could push credit cards, checks, and fiat currencies to the side. However, this has been a slow journey given how volatile so many of these assets tend to be.
Many companies have risked losing profit in accepting crypto, and thus have resoundingly said “no” to crypto payments in the past. The regulation of stable currencies in the UK could now help to bring this practice to an end and create a world where crypto is indeed utilized to pay for items.
We think the market has changed sufficiently for us to look at regulating a broader set of crypto activities including trading of tokens like bitcoin, and we will consult on a world-leading regime for the rest of the crypto-market, too… a regime that will facilitate safe and sustainable, and I hope rapid, innovation.
What an Odd Twist for the Nation
Glen says the United Kingdom sees a lot of potential in crypto. This is odd considering it’s done everything to limit its influence and has often called it an extremely risky space. Nevertheless, Glen says the country is looking to take full advantage of the industry. He stated:
Having robust and effective regulation won’t hinder innovation. It’ll boost it by giving people and businesses the confidence they need to think and invest for the long-term.