BoE says 'stablecoin' payments need same rules as banks

The Bank of England said on Monday that payments with 'stablecoins' - a form of cryptocurrency usually pegged to a traditional currency - should be regulated in the same way as payments handled by banks if they start to become widely used.

The central bank also said it had made no decision yet about whether to issue its own central bank digital currency, or CBDC, a prospect dubbed 'Britcoin' by finance minister Rishi Sunak when he asked the BoE to look into this in April.

"The prospect of stablecoins as a means of payment and the emerging propositions of CBDC have generated a host of issues," BoE Governor Andrew Bailey said. "It is essential that we ask the difficult and pertinent questions when it comes to the future of these new forms of digital money."

Stablecoins are cryptocurrencies designed to have a stable value relative to traditional currencies or to a commodity such as gold, to avoid the volatility that makes bitcoin and other digital tokens impractical for most commerce.

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