Bank of England: “open to” stablecoins for wholesale payments

PANews reported on July 4 that according to Ledger Insights, the Bank of England expressed a forward-looking stance on digital innovation this week, with its executive director Sasha Mills saying that it was "open" to the use of stablecoins for wholesale payments, which contrasts with the Bank for International Settlements' report last week that classified stablecoins as "unreliable currencies." Mills emphasized that financial stability is the top priority, but after the law is revised, the central bank needs to take innovation into account, and the regulatory approach will be more balanced.

There is a major policy shift: the Bank of England has relaxed restrictions on the use of stablecoins in the wholesale market for the first time, but still prefers central bank currency settlement; the reserve requirements in the retail sector have been relaxed to allow some investment in high-quality assets, while temporarily setting a limit on the holdings of individuals and enterprises to prevent deposit losses. Technically, the central bank is developing a synchronization system to enable DLT transactions to be settled through the RTGS system. Mills called on the industry to collaborate to build a "hybrid ecosystem" and pointed out the potential of public chains as a connection layer, emphasizing that London should shift from technology demonstrations to building a new generation of financial systems.

Earlier yesterday, the Governor of the Bank of England warned that stablecoins threaten the public's trust in currency.