The UK government plans to bring stablecoins into its payments regulatory perimeter, Lucy Rigby, the Economic Secretary to the Treasury, told the House of Lords Financial Services Regulation Committee yesterday. The Lords launched a stablecoin regulation inquiry in January 2026. Rigby’s commitment reverses a decision taken by the same Labour government only 18 months ago and reinstates a policy originally set by the previous Conservative administration in 2022.
In 2022 and 2023, HM Treasury said it would amend the Payment Services Regulations to cover fiat backed stablecoins used in UK payment chains. After taking office in July 2024, Labour dropped that plan. In a speech at the Tokenisation Summit in November 2024, then Economic Secretary Tulip Siddiq said the government would not bring stablecoins into payments regulation “at this time” because doing so “would place additional regulatory burdens on certain stablecoin activities in a way that would not be proportionate based on the current use cases.” That position was embedded in the December 2025 final cryptoasset statutory instrument (SI), which regulates qualifying stablecoins under the Financial Services and Markets Act (FSMA) alongside other cryptoassets.
Asked by Lord Smith why the government had changed its view, Rigby cited potential benefits for consumers and businesses from a diversified payments landscape. A Treasury official added that including stablecoins in payments regulations would mean “we can have a payments framework that facilitates both traditional payments and tokenized payments in a coherent and comprehensive way.” A consultation is due by the end of Q2 2026.
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