The UK’s Financial Conduct Authority (FCA) announced the launch of a stablecoin cohort as part of its Regulatory Sandbox, with applications open until 18 January 2026. Separately, Bloomberg reported that the UK’s Debt Management Office is exploring expanding the UK Treasury Bill market, which would be relevant to stablecoin reserves.
The UK has a dual track approach to stablecoin regulation, with the Bank of England supervising systemic stablecoins for prudential and financial stability purposes. Responsibility for other stablecoins falls on the FCA, which also handles conduct and consumer protection regulation for all stablecoins. For now, a stablecoin issued by a firm such as Circle would not be considered systemic.
In a speech yesterday, the FCA’s David Geale said that a “major firm” has already been accepted into the sandbox to test a GBP stablecoin for payments. Sandbox participants will be expected to align their design with the requirements outlined in the FCA’s May consultation. “It’s a unique chance for innovative firms to test their stablecoin products and services under the UK’s evolving regulatory regime, potentially driving new ideas to benefit both wholesale and retail customers,” said Geale.
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