The UK government believes that some stablecoins can play an important role in retail and international payments. The authorities intend to promote the development of these assets, but within the framework of clear rules.
UK accepts stablecoins
A consultation paper published yesterday by Her Majesty’s Treasury, a department of the UK government, explored the scope of regulation applicable to stablecoins. This document also highlights the potential role of stablecoins in the near future in the economy as a whole.
The institution invites all local players in the cryptocurrency market to respond to this consultation in order to develop balanced and fair rules.
Indeed, His Majesty’s Treasury does not seek to stop the development of stablecoins, on the contrary, judging by his statement:
“If the right standards and regulations are followed, some stablecoins can play an important role in retail and international payments (including settlements). This means that they can bring benefits such as speed, efficiency and sustainability.”
The government also points out that some stablecoins support financial inclusion and economic growth both nationally and internationally.
The authors of the document state that the Covid-19 pandemic has significantly accelerated the use of digital payment forms — a feature that can increase interest in stablecoins for sending funds.
Last month, payment giant Visa began a partnership with Circle,one of the companies behind the USDC stablecoin. A partnership that allows all Visa card issuers to integrate sending and receiving payments in US dollars.
A sluggish approach?
Yes, Her Majesty’s Treasury understands the value of stablecoins and sees great potential in them. However, their development on the territory will occur only when a special regulatory framework is deployed.
Eventually, stablecoins can benefit from their own legal classification, different from other cryptocurrencies. At the moment, the true intentions of the British government in relation to these digital assets are not specified. However, with such a positive approach to stablecoins, the UK should probably be friendly to them.
The British government now has all the cards in its hands to help develop these assets, and not to miss its chances, as it does in other countries.
At the time of writing, the stablecoin market was valued at more than $ 32 billion. The use cases for these assets are growing rapidly, and they have become a staple of any portfolio.
Another recent major achievement of this asset class: all banking institutions in the US can now use stablecoins to make payments, while simultaneously using the blockchain nodes on which they are hosted.
The beginning of a new era of stablecoins is approaching and seems inevitable. This asset class is of great interest to governments, and they intend to bet on it.