FCA Selects 4 Firms to Test Stablecoin Innovation in UK Sandbox

The United Kingdom’s Financial Conduct Authority (FCA) selected four companies to join a dedicated stablecoin cohort within its long‑running Regulatory Sandbox.

In a Wednesday press release, the FCA said it chose Monee Financial Technologies, ReStabilise, Revolut and VVTX from a pool of 20 applicants to test how their stablecoin services perform under the UK’s proposed rules in a “safe environment.”

The UK regulator said that its testing would focus primarily on stablecoin issuance and that the four companies would pilot a range of use cases, including payments, wholesale settlement and crypto trading, with findings intended to inform the UK’s final stablecoin rules.

Matthew Long, director of payments and digital assets at the FCA, said that the regulator would support UK stablecoin issuers to ensure that they could “be trusted for payments, settlement and trading.”

He said that the FCA’s involvement would “benefit consumers and financial transactions,” and that it would help to “deliver the FCA’s strategy and the Government’s National Payments Vision.”

Sandbox permits testing in controlled environment

The FCA’s sandbox was launched in 2016 under Project Innovate, and the stablecoin‑specific cohort opened for applications in November 2025, aimed at prospective UK stablecoin issuers wanting to pilot pound or other fiat‑backed tokens and related payment use cases while the country’s permanent stablecoin regime is being finalized. 

The four companies chosen for the cohort are expected to begin testing in the first quarter of 2026, and their findings will “help shape the UK’s final stablecoin rules later in 2026,” the release states.

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All companies will need to be authorized under the new regime once it goes live in October 2027.

The regulator had previously flagged sterling‑denominated stablecoin payments as a priority for everyday use and has already brought in projects like regulatory technology firm Eunice to explore disclosure standards and market data frameworks for crypto markets.

FCA’s stablecoin plans face industry criticism

Despite the FCA’s efforts, industry leaders such as Coinbase CEO Brian Armstrong have warned that the UK’s emerging stablecoin regime risks undercutting the country’s competitiveness in the digital economy.

In a Wednesday X post, Armstrong pointed to proposals from the Bank of England to cap the amount of stablecoin individuals and businesses can hold, arguing that such caps would act as an “innovation blocker” at a time when other jurisdictions are moving quickly to attract stablecoin and blockchain businesses.

He urged UK residents to support a pro‑innovation strategy for blockchain and stablecoins by signing a petition coordinated by advocacy group Stand With Crypto UK that has already garnered over 80,000 signatures, highlighting the tension between the UK’s cautious, payments‑first approach and industry calls for looser limits on stablecoin use.

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