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UK FCA sprint says stablecoins fit cross-border payments best
The FCA said its March initiative fed into June 30 final rules for UK-issued stablecoins to be fully backed by reserve assets and redeemable at par.
Cross-border payments emerged as the clearest near-term use case for stablecoins, while UK retail consumer adoption was expected to lag, according to findings from the UK Financial Conduct Authority’s Stablecoin Sprint, published by Cointelegraph. In a March policy initiative, the FCA convened banks, payment firms, stablecoin issuers, and other industry participants to assess how stablecoins could be used. Participants argued stablecoins offer the biggest advantages in emerging markets where access to US dollars is more limited. They also said stablecoins may deliver less value in major payment corridors, where existing payment systems are already fast and relatively inexpensive. For the United Kingdom specifically, participants said domestic consumers have little incentive to switch because current payment options are already quick and low cost, though merchants could benefit from lower costs and faster settlement. The sprint’s findings helped shape the FCA’s June 30 final rules requiring UK-issued stablecoins to be fully backed by reserve assets and redeemable at par. The regulator added that the feedback will also influence its future policy on stablecoin payments.