The United Kingdom maintains its stance on stablecoin and is pushing for strict crypto regulation

The UK has strategically pushed out the deadline for comments on the BOE discussion paper on stablecoin regulation. As part of a larger effort to provide a thorough regulatory framework for crypto assets, the deadline has been extended from February 6 to February 12.

While the timeframe for the Financial Conduct Authority’s (FCA) associated discussion paper has not altered, this development shows that the UK is dedicated to implementing thorough and comprehensive regulations for the changing cryptocurrency sector.

As a statement that the UK values stakeholder input in determining crypto-asset regulation, the BOE has extended the comment time for its discussion paper. The BOE hopes to ensure that the regulatory framework is thorough and takes into account the complex nature of the business by giving extra time for comment in order to obtain varied opinions.

To produce a balanced and informed regulatory environment, the approach aims to do more than simply create legislation. It also seeks to stimulate interaction between regulatory authorities and the financial industry.

The possible effects of integrating a retail-focused stablecoin backed by sterling into the UK’s payment infrastructure are the primary subject of the BOE’s discussion paper. It takes into account important details, including the needs of wallet providers, transfer operations, and the overall objective of keeping the financial system secure and stable. Emphasizing the importance of safeguarding the safety and operating efficiency of the financial infrastructure, the central bank is determined to ensure that new technologies are seamlessly integrated.

However, the FCA’s discussion paper looks at stablecoins from a more holistic perspective, investigating their potential applications beyond only payment systems. Substantially covered are stablecoin audits, reporting, backing, and custodianship.

“Same risk, same regulator outcome” is a primary concept of the FCA’s strategy, which seeks to establish a regulatory environment in which conventional financial services and crypto-assets subject to comparable risks are subject to equivalent standards.

The legislation covers custodianship and suggests that the BOE may impose more regulations in areas like off-chain transactions, anti-money laundering (AML), and know-your-customer (KYC) procedures for unposted wallets.

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