The United Kingdom should advance its stablecoin regulatory regime, but with calibrations to avoid making a pound-denominated market commercially unworkable, a House of Lords committee concluded in a published report. The cross-party Financial Services Regulation Committee argued that the UK currently lags behind the United States and the European Union, and that the absence of a clear regime has constrained development and investment in the UK stablecoin sector, even as dollar-pegged tokens such as USDt and USDC continue to expand globally. According to Cointelegraph, the committee’s findings endorse much of the Bank of England’s and the Financial Conduct Authority’s proposed framework while cautioning against provisions that could hamper the viability or competitiveness of UK-issued stablecoins.

The report supports a 1:1 reserve backing standard for fiat-referenced stablecoins and backs a Bank of England backstop lending facility for systemic issuers. Yet it flags several elements from the BoE’s November 2025 consultation as potentially damaging. In particular, the committee criticizes the proposal that systemic issuers hold at least 40% of their backing assets in unremunerated central bank deposits, describing the requirement as having attracted significant criticism and potentially undermining the viability of issuers or the UK’s international competitiveness. It also notes that proposed temporary holding limits for businesses and individuals could impede growth in GBP-denominated stablecoins and may be impractical to implement.

Key takeaways

– 1:1 reserve backing and BoE backstop: The committee endorses the principle that fiat-collateralized stablecoins should be backed by high-quality assets at a 1:1 ratio and supports a BoE backstop facility for systemic issuers.

– Criticism of reserve-dust policies: The proposal to require a substantial share of reserves in unremunerated central bank deposits drew sharp critique and is seen as potentially detrimental to issuer viability and UK market competitiveness.

– Holding limits are problematic: Temporary limits on holdings by entities and individuals are viewed as potentially stifling and not readily implementable.

– Remuneration bans and MiCA alignment: The committee notes the intention to prohibit interest payments on sterling-systemic stablecoins, aligning with MiCA’s approach in the European Union and parallel discussions in the United States, though the policy landscape remains unsettled.

– Aim to nurture, not merely police: The Lords advocate a framework that grows a robust pound-denominated stablecoin sector while managing illicit-finance and financial-stability risks, clarifying how dual regulation of systemic issuers would operate in practice.

Regulatory alignment and systemic stablecoins

The committee’s analysis centers on aligning the UK regime with broader regulatory objectives—financial stability, consumer protection, and the integrity of the payments landscape—while safeguarding the UK’s competitiveness as a financial hub. The report favors the core Bank of England/FCA framework that treats systemic stablecoin issuers similarly to other systemically important financial entities, with appropriate oversight and backstops to mitigate failure risk. However, it argues for recalibrations to avoid suppressing the growth of sterling-backed tokens that could compete as a payment instrument in the domestic market.

A notable tension emerges around the BoE consultation’s reserve requirements and asset mix. The 40% threshold for unremunerated central bank deposits is singled out for concern, with the committee noting that such a rule could hamper issuer resilience and raise cross-border cost of capital for UK platforms. The debate mirrors wider policy tensions in stablecoin regulation: safety versus market functioning, and the risk of shifting activity to less-regulated jurisdictions if capital costs in London are too high.

In urging timely progress, the Lords emphasize the need for a clear regulatory timetable and for detailing how dual regulation would function in practice for systemic issuers. The committee underscores that the UK should calibrate reserve standards and liquidity rules so that sterling stablecoins can compete with traditional payment rails, rather than being regulated out of relevance. This viewpoint aligns with a broader policy objective: to anchor innovation within a robust regulatory perimeter that supports safe, efficient payments while minimizing systemic risk.

Remuneration restrictions, incentives, and policy coherence

A central policy question concerns whether stablecoin holders may receive rewards or interest on holdings. The BoE’s draft regime contemplates banning remuneration for holders of sterling-denominated systemic stablecoins, a stance consistent with the EU’s Markets in Crypto-Assets Regulation (MiCA) and with ongoing debates in the United States, including aspects of the GENIUS Act. The committee’s position highlights the practical implications of such a ban: while it reinforces a focus on payments use cases—fast, low-cost transfers—without converting stablecoins into yield instruments, it also raises concerns about the sustainability and business model of UK issuers.

The tension becomes more acute when considering potential non-interest incentives, such as card-style rewards or other non-financial benefits. The committee warns that uncertainty about what will be permitted could affect product design, issuer capital planning, and consumer expectations. The overarching question is whether the regulatory framework can encourage the development of resilient, consumer-friendly GBP stablecoins that can be integrated with existing banking and payments infrastructure, while preventing yield-driven incentives that could blur the line between money and investment.

Inquiry evidence and strategic choices

The Lords’ conclusions reflect months of evidence from industry participants and academics. In its proceedings, the committee pressed witnesses on whether stablecoins can extend beyond simple “on and off-ramps into crypto” and whether the UK can manage associated financial-stability and bank-funding risks. Witnesses offered divergent views on the GENIUS Act’s approach to non-bank issuers, reflecting broader policy debates in the United States. Across the spectrum, the committee stressed that stablecoins should not create new channels for illicit activity and that the regulatory framework should be robust and enforceable.

Beyond enforcement, experts emphasized the need to balance regulation with market development. The Lords argue for a UK strategy that nurtures and harnesses stablecoin technology as a payment mechanism, rather than treating it as a peripheral or purely speculative asset class. This approach presumes a stable, predictable regulatory environment that reduces uncertainty for issuers, banks, and payment providers while maintaining appropriate risk controls.

Implications for market structure, licensing, and cross-border considerations

For market participants, the Committee’s recommendations signal a push toward a structured, rules-based GBP stablecoin ecosystem anchored by a clear regulatory backstop and rigorous reserve standards. This has several practical implications:

– Licensing and oversight: Issuers of systemic GBP stablecoins could face licensing requirements, governance standards, and ongoing supervisory actions designed to ensure resilience, liquidity, and consumer protection.

– Banking integration and liquidity: A regulated stablecoin market, with calibrated reserve requirements and a credible backstop, could facilitate integration with UK banks and the broader payments rails, potentially improving settlement efficiency and reducing settlement risk.

– Cross-border considerations: The UK’s approach would need to align with international standards and vary with other major jurisdictions’ regimes. The committee’s emphasis on practical viability suggests a preference for harmonized, but not burdened, cross-border operations that support legitimate use cases while limiting regulatory arbitrage.

– Compliance and risk management: Financial institutions, exchanges, and issuers would be expected to implement robust AML/KYC controls and risk-management practices commensurate with the systemic nature of the instruments, consistent with ongoing UK enforcement priorities.

Closing perspective

The House of Lords committee presents a principled call for a measured, ambitious approach to stablecoins that supports innovation and efficiency in the UK payments landscape while maintaining robust protections. The report argues for sustaining timelines, clarifying dual-regulatory arrangements for systemic issuers, and recalibrating specific requirements to avoid stifling growth. As policymakers, regulators, and market participants translate these recommendations into policy design, the key question will be whether the UK can establish a stable, compliant pound-stablecoin market that competes effectively with global standards without compromising financial stability or regulatory integrity. The coming months will reveal how Treasury, the Bank of England, and the Financial Conduct Authority operationalize these positions and navigate the balance between risk management and market development. What remains unresolved is how allowances for non-interest incentives and evolving cross-border regimes will shape issuer strategies and the broader trajectory of the UK stablecoin ecosystem.

The US Securities and Exchange Commission (SEC) has elevated digital assets to a strategic priority, calling for regulatory clarity around blockchain technology, tokenization and crypto market infrastructure through 2030.

The shift was outlined in the agency’s draft Strategic Plan for fiscal years 2026–2030, published Tuesday. Alongside broader goals focused on capital formation, investor protection and agency modernization, the SEC dedicated an entire objective to digital assets and distributed ledger technology.

The agency said it aims to “provide a firm regulatory foundation for digital assets and distributed ledger technologies through a rational, coherent, and principled approach,” adding:

“Blockchain and crypto asset technologies have the potential to revolutionize America’s financial infrastructure.”

An excerpt from SEC Chair Paul Atkins’ message
in the agency’s draft Strategic Plan. Source: SEC

The strategic plan acknowledges that the growth of digital assets has outpaced existing regulations and calls for greater legal certainty for market participants. It also highlights tokenized offerings and onchain financial infrastructure as areas where the SEC intends to support compliant capital formation.

The document further references custody, trading and staking services, saying they should be able to operate under appropriate oversight without duplicative or conflicting regulatory requirements.

Related: SEC approves Paxos as ‘blockchain-native’ clearing agency

SEC reiterates the need for a clearer division of oversight with CFTC

Another key priority outlined in the draft plan is clarifying the division of responsibilities between the SEC and the Commodity Futures Trading Commission (CFTC), a longstanding issue in US digital asset regulation.

As part of its push for a more coherent regulatory framework, the SEC said establishing clear rules for digital assets “also involves clarifying jurisdictional questions between the SEC and Commodity Futures Trading Commission.”

The agencies have already taken steps toward closer coordination. In March, the SEC and CFTC signed a memorandum of understanding to strengthen cooperation and information sharing as emerging technologies continue to reshape financial markets.

Source: Mike Selig

Jurisdictional boundaries between the SEC and CFTC are also a central issue in congressional deliberations over the Digital Asset Market Clarity Act, a market structure bill that seeks to establish a regulatory framework for digital assets.

As Cointelegraph previously reported, the legislation is expected to expand the CFTC’s authority over large segments of the digital asset market. The bill advanced out of the Senate Banking Committee last month and is expected to proceed to the Senate floor for a full vote.

Related: Clarity Act risks repeat of Europe’s mistakes, crypto lawyer warns

Market anxiety surrounding recent institutional shifts and insider moves is merely typical bottom behavior, Bitmine Immersion (BMNR) Tom Lee told CoinDesk.

Lee dismissed the idea that Strategy selling 32 BTC signals trouble.

“Michael said he was planning to sell bitcoin, so he’s following through on what he was going to do,” Lee said in an interview on Tuesday. “At the end of the day, he’s still got 99.99% of his bitcoin, and he only makes money if bitcoin goes up.”

Saylor’s decision to sell bitcoin at an average price of $77,135, generating roughly $2.5 million to help fund preferred stock dividend payments, sparked unease. The transaction marked the corporate giant’s first bitcoin sale in nearly four years and prompted questions about whether one of the asset’s most prominent institutional advocates was changing course.

The firm still holds more than 843,700 BTC, meaning the disposal represented a microscopic 0.004% of its total reserves. Analysts across Wall Street have largely agreed that the transaction was economically immaterial to the core accumulation thesis.

Lee’s comments come alongside broader industry unease following the longest outflow streak (11 consecutive days) since U.S. spot exchange-traded funds (ETFs) debuted in January 2024, worth $3.4 billion. Lee pointed out that these capital exits are a classic trailing indicator of a market cycle resetting.

“This is what you expected at the bottom,” Lee explained. “People sell at the bottom, right?”

Despite short-term negative price pressure and market panic, Lee confirmed that Bitmine’s broader macroeconomic playbook remains unchanged, including its ongoing strategy for other major layer-1 assets.

Lee also confirmed that the firm’s existing accumulation plans for ether (ETH) remain “on track.)

Bitmine ramped up ETH purchases last week, making its most significant since December. It bought 111,942 ether (ETH) worth around $237 million at current prices. That lifted the firm’s holdings to almost 5.4 million ETH, about 4.47% of ether’s circulating supply.

Read more: Saylor’s Strategy sold bitcoin for the first time since 2022. These firms are still buying

Top Democrats on three House and Senate committees called on the US Labor Department to halt its plans to allow digital assets and “alternative assets” to be held in Americans’ retirement plans. 

In a Tuesday letter, Senator Bernie Sanders, Senator Elizabeth Warren and Representative Bobby Scott asked acting Labor Secretary Keith Sonderling to rescind the department’s proposal to allow private equity, digital assets, private credit, and other “alternative assets” to be included in 401(k) plans.

Source: Senate Banking Committee

They said the policy would “expose retirement accounts to exceptionally volatile assets, like digital currency,” citing a “lack of regulation and safeguards” putting many cryptocurrencies at risk of fraud.

As the ranking members of the Senate Banking Committee, Senate Committee on Health, Education, Labor and Pensions, and House Committee on Education and Workforce, respectively, they said that the current administration had weakened enforcement of crypto fraud at financial agencies like the Securities and Exchange Commission (SEC).

“The application of securities laws to crypto assets is rapidly evolving, and many securities law protections that investors have for public securities may not be available for crypto,” said the letter. “This lack of sufficient guardrails is likely to harm investors.”

Related: Basic adds VanEck crypto ETFs to 401(k) plans amid US retirement shift

The proposed policy, announced by the Labor Department in March, followed an August 2025 executive order from US President Donald Trump directing agencies to “democratize access to alternative assets,” including crypto. According to the Investment Company Institute, Americans held about $10.1 trillion in 401(k) plans as of Dec. 31.

Trump family conflicts of interest cloud 401(k) order and CLARITY Act

Sanders, Warren and Scott questioned whether the Labor Department policy would financially benefit anyone in the current administration, given Trump was “rife with conflicts of interest in this area,” including his family’s crypto venture, World Liberty Financial.

Lawmakers have made similar arguments in proposing amendments to a digital asset market structure bill, the CLARITY Act, expected to be addressed in the US Senate soon. Democrats in that chamber have said that they would not vote for any legislation that doesn’t contain provisions on ethics.

Magazine: HYPE chases $100 target, ETH could dump below $1800: Market Moves

Bitcoin slipped below the psychologically important $70,000 level on Tuesday, trading around $69,300, as derivatives positioning reached some of the most elevated levels of the current cycle.

Open interest across bitcoin futures markets has climbed to approximately 773,000 BTC, a level last seen only a handful of times on record, according to Coinglass data. Previous peaks have occurred during local market tops. The current positioning suggests leveraged traders are betting on a quick price rebound rather than trimming risk.

That growing leverage is also reflected in perpetual futures funding rates, which have risen to roughly 10% annualized, according to Coinglass data. Positive funding means long traders are paying shorts to maintain positions. As bitcoin continues to fall, long leverage liquidations occur, sending the price lower.

Broader sentiment remains apathetic. The Crypto Fear & Greed Index continues to signal fear, while the Coinbase Premium Index remains deeply negative at around -100. The metric measures the price difference between bitcoin on Coinbase and offshore exchanges, with a negative reading often indicating weaker demand from U.S. institutional and spot investors — a trend clearly reflected in the continuing outflows from the U.S.-based spot BTC ETFs.

The divergence between leveraged bullish positioning and deteriorating spot demand comes as bitcoin remains largely uncorrelated to broader risk assets, with AI and software stocks continuing to push to fresh highs.