UK to Introduce Legislation on Regulating Fiat-Backed Stablecoins from 2024!

The United Kingdom government has updated its plans to regulate fiat-backed stablecoins in payment chains, with plans to introduce specific legislation to parliament in 2024. The Financial Conduct Authority (FCA) will be responsible for regulating fiat-backed stablecoins, while non-fiat-backed stablecoins, including algorithmic stablecoins, will not be allowed into regulated payment chains and will be subject to the same requirements as unbacked crypto assets. Local companies will be “arrangers of payment”, ensuring overseas stablecoins meet local standards. The FCA will also have the authority to demand that stablecoin issuers hold all reserves in a statutory trust. The regulations will come into effect under the Financial Services and Markets Act, passed in June 2023.