Payments made in ‘stablecoin’, a cryptocurrency usually pegged to a traditional currency, should be regulated in the same way as payments made by banks if it becomes widely used, the Bank of England (BoE) said today. The BoE Chairman also spoke about the central bank’s digital currency.
In the statement made by the BoE, stablecoins and CBDCs were mentioned. BoE Chairman Andrew Bailey said:
“As a means of payments in stablecoin expectations and proposals appeared in the CBDC has created a series of problems. When it comes to the future of these new forms of digital currency, it’s crucial that we ask the hard and appropriate questions.”
The BoE could become large enough to have an impact on the financial stability of digital currencies. In such a case, he said, they would need more regulation than they currently do. BoE said:
“Stablecoins used as money must meet standards equivalent to those provided by commercial bank money, also known as bank deposits.”
The BoE is among major central banks around the world ramping up digital cash issuance, a move aimed at fending off potential threats to traditional money and making payment systems more seamless.
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