Osborne warns UK stablecoin rules risk losing digital finance lead
Former Chancellor George Osborne warns that the UK’s cautious stablecoin regulation is threatening London’s position as a global digital finance hub. In an FT op-ed, he criticizes Chancellor Rachel Reeves and Bank of England Governor Andrew Bailey for bureaucratic delays and unclear legal frameworks. He calls for decisive action akin to the 1980s Big Bang reforms, including a dedicated crypto task force and expedited stablecoin legislation. Meanwhile, HM Treasury under Reeves is collaborating on stablecoin frameworks, digital pound research and DLT sandboxes to boost innovation. The Bank of England insists on strict money tests and full central bank backing for commercial stablecoins, effectively limiting issuance. With the global stablecoin market exceeding $250 billion and UK participation minimal, clear UK stablecoin regulation will be crucial in the next 1–2 years to secure Britain’s digital asset leadership.
Bearish
News of regulatory caution in the UK stablecoin sector adds uncertainty to stablecoin issuance. Traders may reduce positions ahead of legislation. Short-term bearish pressure on stablecoin markets is likely. Long-term outlook depends on regulatory clarity, but current stance hinders market stability and growth.