Preface

The urgency for the United Kingdom to form a national stablecoin strategy is increasingly emphasized by key crypto industry players. In a recent open letter, leading figures from the crypto world urged UK financial authorities to adopt strategic measures that will ensure the country's relevance in the evolving digital asset landscape. Without such measures, the industry leaders warn that the UK may find itself lagging behind the United States in this burgeoning technological space.

Lazy bag

Several crypto firms highlight the necessity of a UK stablecoin strategy to stay competitive and foster innovation. They point to opportunities and risks within the digital finance arena.

Main Body

The discussion surrounding the United Kingdom's need for a structured stablecoin approach has become a focal point among cryptocurrency enterprises. In an effort to advance the conversation, 30 prominent figures in the digital currency sector have addressed Finance Minister Rachel Reeves calling attention to the critical need for the UK to transform into a rule-maker instead of a rule-taker in the digital age of assets. Encouraging a proactive and collaborative approach, the open letter emphasizes that stablecoins should be regarded as integral financial infrastructure rather than a mere technological threat.

Stablecoins, a subset of cryptocurrencies tied to traditional government fiat currencies, have established themselves as essential components within the crypto ecosystem. Tether's USDT and Circle's USDC are among the most notable, both linked to the U.S. dollar. Currently, according to data from CoinGecko, the stablecoin sector is valued at over $280 billion; however, the UK-specific market remains considerably smaller, with a capitalization of approximately £461,224.

Numerous insiders in the cryptocurrency ecosystem have voiced concerns regarding the UK's regulatory narrative on stablecoins, particularly the legal interpretation of these digital instruments as "crypto-assets with reference to fiat currency." This perception underscores the issue of focusing predominantly on the form over their intended function, which is analogous to treating a cheque purely as paper linked to currency. Such narrow definitions hinder the ability to harness the broader applications of stablecoins as instruments of trade and finance.

The proposed national stablecoin strategy is anticipated to elevate the UK's status as a leading global financial center. Industry leaders assert that a well-defined strategy will not only drive innovation and creation of new revenue channels from fees and foreign exchanges but will also stimulate demand for government securities through digital means. This vision is echoed by key executives from Coinbase, Kraken, and other major players, highlighting the mutual goal of strengthening the UK’s financial prowess.

Concerns remain valid, especially in the context of past incidents such as the 2022 collapse of the terra stablecoin and its associated token luna, which saw both values plummet to zero. This historical failure also led to a temporary de-pegging of USDT from the dollar, albeit it has since recovered to its established value.

In the realm of digital banking and payment systems, Daragh Maher, HSBC's head of digital assets research, supports the integration of stablecoins as an intermediary between conventional financial markets and burgeoning digital asset technologies. As a quasi cash-equivalent within the digital arena, stablecoins act as a foundational currency for numerous crypto assets and offer an alternative means of transferring funds via blockchain-based channels.

However, regulatory frameworks pose significant barriers to widespread adoption. Maher underscores the importance of cultivating a regulatory environment that embraces the potential of stablecoins to maximize their utility and security.

Key Insights Table

Aspect	Description
National Strategy Urgency	Major crypto firms call for a UK plan to stay ahead in digital finance.
Stablecoins Role	Seen as financial infrastructure, stablecoins bridge traditional and digital finance.

Last edited at：2025/8/20