The Financial Services and Markets Bill was introduced into the United Kingdom’s Parliament on Wednesday. The comprehensive bill, which was meant to preserve the U.K.’s leading place in the financial world post-Brexit, repealed retained EU laws, reformed certain insurance laws, supported victims of financial fraud and established new growth and competitiveness objectives. The bill also regulated stablecoins.
The presence of stablecoin regulation in the bill was confirmed the evening before in the programmatic speech delivered by hancellor of the Exchequer Nadhim Zahawi. Although stablecoin regulation was intended to be part of the bill from its inception, the fate of that regulation had become a matter of concern for some observers after the recent upheaval in crypto markets and the departure of pro-crypto members of the government earlier in July, which included Economic Secretary to the Treasury John Glen and Zahawi’s predecessor Rishi Sunak.
2. Embracing cryptoasset technology to establish a stablecoin regime and enable the use of a wider set of payment methods in the UK. pic.twitter.com/OByPNFQJh0
— HM Treasury (@hmtreasury) July 20, 2022
The bill extended the Banking Act of 2009 and Financial Services (Banking Reform) Act of 2013 to cover “digital settlement assets” (DSAs) and authorized the Treasury to regulate DSAs, payments made with DSAs, DSA service providers and DSA insolvency arrangements. Those regulations will be made in consultation with the Financial Conduct Authority (FCA), the Bank of England and other regulators as appropriate.