Bank of England warms up to stablecoins, targets real-world payments

The Bank of England is finally warming up to stablecoins, and it’s not a ￰0￱ Bailey, the guy at the top of the UK’s central bank, now says the future of money might not run through commercial banks ￰1￱ in the Financial Times , Andrew said it would be “wrong to be against stablecoins as a matter of principle,” giving a clear nod to crypto’s growing role in payments. That’s not something you hear every day from a central banker whose job is to keep the old system alive. Stablecoins, according to Andrew, can push innovation forward, especially in payment systems, both inside the country and across ￰2￱ is a big change from the same man who once treated crypto like a ticking time bomb.

Now, he’s cracking open the door, signaling that these coins might play a real role in the economy, not just in the crypto ￰3￱ there’s a catch: public trust has to come ￰4￱ targets stablecoins used for real-world payments Andrew said he’s only interested in stablecoins that actually do something in the real ￰5￱ the ones you use to hop in and out of trading platforms or meme ￰6￱ wants coins that are used at scale for everyday payments and settling financial stuff, not tokens just floating around for ￰7￱ don’t count as money in his book, and he made that crystal ￰8￱ any stablecoin to be taken seriously, Andrew said the assets backing them must be ￰9￱ debt, no shaky loans, no gambling with interest rates.

He’s talking zero exposure to credit or exchange rate ￰10￱ the value isn’t stable, it’s not a ￰11￱ that’s not even the whole ￰12￱ warned that even risk-free assets can’t stop cyber attacks. So, if these coins want trust, they’ll need their own kind of insurance system, just like bank deposits ￰13￱ if something goes wrong, their users should be treated like priority creditors in any ￰14￱ means no rug pulls, no back-of-the-line ￰15￱ law should back ￰16￱ also called out the current way many stablecoins ￰17￱ terms of exchange? All over the ￰18￱ depend on sketchy crypto exchanges, with users left at the mercy of confusing fine ￰19￱ said that has to ￰20￱ must know exactly how to cash in and out, and those terms should be the same for everyone, every ￰21￱ plans full stablecoin regime and questions lending model Andrew took it ￰22￱ said the UK needs to rethink how money and credit are tied ￰23￱ now, banks hold deposits and use them to hand out ￰24￱ system, known as fractional reserve banking, means your money doesn’t just sit there; it fuels lending across the ￰25￱ if stablecoins start handling the money part, who’s going to handle the lending?

He said it’s possible to separate money from ￰26￱ stablecoins focus on payments, and let non-banks step up on loans. That’s not how the system works today, but Andrew said it could happen. Still, he warned that this shouldn’t be ￰27￱ UK needs to study how this plays out, especially during economic ups and downs. That’s the only way to avoid crashing the system while trying to improve ￰28￱ admitted the technology behind stablecoins is new, but the question isn’t.

He said the Bank of England has always asked how to keep money and lending ￰29￱ that link, economies don’t ￰30￱ move forward, the Bank of England is putting together a consultation paper. It’ll drop in the coming months and will lay out the rules for any stablecoin that wants to operate at ￰31￱ includes daily payments or settling tokenized financial ￰32￱ major idea: giving big-name UK stablecoins access to BoE ￰33￱ would make them look and act more like money backed by the ￰34￱ said this will be a critical part of building a new system, one that lets the UK use what stablecoins offer without tearing apart the whole ￰35￱ balance? Stay innovative, stay secure.

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