The U.K.’s Financial Conduct Authority (FCA) has selected four firms—Revolut, Monee Financial Technologies, ReStabilise, and VVTX—to participate in its Regulatory Sandbox, a move aimed at testing stablecoin issuance as policymakers work toward establishing comprehensive regulations. The FCA announced that this cohort will pilot stablecoin products in real-world scenarios, with necessary safeguards put in place. The focus will be on exploring various use cases, including payments, wholesale settlements, and cryptocurrency trading, with testing set to commence in the first quarter of 2026. The findings from these trials are expected to inform the final stablecoin regulations to be released later that year.
Matthew Long, the FCA’s director of payments and digital assets, emphasized that supporting U.K. stablecoin issuers is key to ensuring consumer trust in these financial instruments. “It will benefit consumers and financial transactions and help to deliver the FCA’s strategy and the Government’s National Payments Vision,” Long stated.
Despite the FCA’s initiatives, industry leaders have voiced concerns about the Bank of England’s (BoE) proposed stablecoin caps, claiming they hinder innovation and threaten the U.K.’s ambition to be a global hub for digital assets. The BoE had previously published a discussion paper suggesting caps ranging from £5,000 to £20,000 for individuals and £1 million to £10 million for businesses. Brian Armstrong, CEO and co-founder of Coinbase, has rallied U.K. users to petition Parliament for a reconsideration of these limits; the petition has currently amassed 81,909 signatures towards a goal of 100,000.
Armstrong expressed his apprehension regarding the implications of the caps in a post on social media, arguing that finalizing stablecoin regulations in such a restrictive manner could undermine the U.K.’s competitiveness in the burgeoning digital economy. He pointed out the urgent need for more favorable regulations against the backdrop of the global crypto landscape, which is rapidly evolving.
While the government has committed to positioning London as a center for global digital asset activity, comprehensive legislation addressing stablecoins and the broader cryptocurrency sector is anticipated to be voted on in Parliament later this year, with an implementation timeline extending into 2027. Industry experts, such as Andrew MacKenzie, CEO of sterling stablecoin creator Agant, have criticized this regulatory timeline as insufficient to support the U.K.’s ambitions of becoming a global crypto hub.
“The U.K. has a long history of being a financial hub,” Armstrong remarked. “Embracing and encouraging innovation, especially when other countries are moving fast here, is important for maintaining that.”
