U.S., UK back cross-border stablecoin use in joint framework push

Investing.com -- The United States and the United Kingdom on Tuesday outlined a shared vision for regulating stablecoins, pledging closer cooperation to support their use in cross-border payments and capital markets while promoting innovation, financial stability and consumer protection.

In a joint statement issued through the Transatlantic Taskforce for Markets of the Future, the two governments said they intend to align their developing stablecoin regulatory regimes where appropriate, giving businesses greater clarity and confidence to expand digital financial services across both markets.

The statement said both countries view stablecoins as an important driver of digital money innovation and will support their safe and sound use in cross-border payments, settlements and tokenized financial markets. They also endorsed the coexistence of different forms of digital money, including regulated stablecoins and tokenized bank deposits.

The U.S. and UK said they aim to establish clear, consistent and risk-based regulatory and supervisory frameworks, avoiding rules that unnecessarily fragment markets or discourage cross-border competition. They also said reserve and prudential requirements should be proportionate to risk and should not impose excessive ring-fencing or barriers to entry.

The two governments reaffirmed that stablecoins marketed as money should be fully backed on at least a one-to-one basis by high-quality liquid assets. They also committed to strong standards for reserve segregation, custody and timely redemption, while supporting clear legal protections for stablecoin holders in the event of an issuer's insolvency.

Looking ahead, the U.S. and UK said they will explore formal mechanisms that could allow stablecoins issued in one jurisdiction to access the other's market, subject to each country's laws and regulatory processes, as part of broader efforts to strengthen transatlantic digital financial integration.

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