Bank of England Sets New Stablecoin Goals Amid US Debt Crisis

The Bank of England (BoE) has been given new objectives to drive innovation in payments and digital finance, ensuring the UK remains a global leader. The BoE will oversee sterling-backed systemic stablecoins that pose a risk to the nation's financial system.

Meanwhile, efforts continue to implement the GENIUS Act, which requires stablecoin issuers to hold U.S. federal- or state-issued licenses. The Treasury Department is seeking public comments on its proposed rulemaking efforts, with a deadline of October 19.

Treasury Secretary Scott Bessent's bond market intervention has failed to lower yields for more than two days, prompting the government to suggest injecting steroids into buybacks by tapping into the nearly $1 trillion in the Treasury's general account. Stablecoin issuers are significant holders of T-bills, with USDT-issuer Tether claiming to hold $115 billion worth of short-term Treasuries.

The GENIUS Act co-author Sen. Bill Hagerty hopes that the bill will drive structural demand for U.S. Treasuries and cement dollar dominance in the digital arena.