The UK government announced it will give the Bank of England (BoE) a formal stablecoin mandate, introducing a secondary statutory objective to support innovation in payment systems and emerging digital money. The announcement was made on August 27, 2026, via an official HM Treasury release, while financial stability remains the Bank’s primary duty.
Under the new rules, the regulator will be legally required to help stablecoins and other digital settlement assets develop within its oversight. HM Treasury confirmed that the secondary objective sits below the primary financial stability mandate, meaning the Bank is not forced to back any innovation that could undermine financial stability.
This framework extends an existing model previously introduced through the Financial Services and Markets Act 2023 for central counterparties and central securities depositories to systemic payment systems utilizing digital settlement assets.
City Minister Lucy Rigby noted that tokenisation and distributed ledger technology could transform global financial markets, with the new objective designed to help the Bank drive innovation in payments and digital finance to maintain the UK's position as a global financial hub. BoE Deputy Governor Sarah Breeden also welcomed the move, stating it strengthens the Bank's ability to support innovation without compromising stability. The Bank will now report annually to Parliament on how it advanced the payments innovation agenda.
The legislative path runs through the Financial Services and Markets Bill, which is next due in the House of Lords on September 7 and September 9, 2026. This follows earlier regulatory shifts, including a BoE reform that dropped per-person holding caps and established a £40 billion issuance guardrail for stablecoin issuers.
Market participants are also tracking upcoming regulatory milestones, including the Financial Conduct Authority (FCA) crypto authorisation window opening on September 30, 2026, the full cryptoasset regulatory regime scheduled for October 25, 2027, and the BoE stablecoin consultation closing on September 22, 2026. Firms participating in the FCA stablecoin sandbox, such as Revolut, along with UK banks testing tokenized deposits, stand among those positioned to benefit from the regulatory clarity.
