Wednesday, October 4, 2023

The Bank of England (BoE) plans to carry on with its plans for a systemic stablecoin regime a consultation response showed on Monday.

The consultation set out that systemic stablecoins would be supervised by both the BoE and Financial Conduct Authority (FCA), which was welcomed by respondents. Respondents and the government also supported extending the accountability framework (which evaluates whether the regulators approach is future proof) to systemic stablecoins.

“As for views concerning FMI SAR (the regime) primacy in cases of insolvency of future systemic payments entities, this was widely well received,” the consultation document said.

The U.K. released a series of consultations last year detailing that systemic stablecoin’s would be brought under existing regulations with a new objective of returning customer funds alongside the objective of making sure operations continue, something which some respondents worried about.

“Few others noted concerns that adding a new objective for returning customer funds to all systemically important payments entities may lead to situations where this was prioritised over ensuring continuity of service to mitigate acute stability risks,” the document said. The government said that it will continue to work with regulators to review its approach.

The U.K. recently passed the Financial Services and Markets Act 2023 into law which gave the BoE powers to set up a systemic stablecoin regime.

CoinDesk reached out to the Bank of England for comment.

Read more: What the Bank of England’s Stablecoins Regime Could Look Like

Edited by Parikshit Mishra.

#UKs #Central #Bank #Forges #Ahead #Plans #Systemic #Stablecoin #Regime

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