BoE Gets New Mandate to Support Stablecoin Innovation

The Bank of England is set to receive a new mandate that puts stablecoins at its center. The UK government plans to give the central bank a secondary objective to support innovation in payment systems and emerging forms of digital money.

The proposed change would extend an existing approach used to regulate central counterparties (CCPs) and central securities depositories (CSDs). This new responsibility would require the central bank to report annually to Parliament on its progress toward the payments innovation objective.

The government expects to implement the objective through amendments to the Financial Services and Markets Bill, which is scheduled for further debate in the House of Lords on September 7 and 9. The mandate's impact may depend on how BoE uses its annual reporting requirement.