Bank of England Governor Sounds Alarm: UK Stablecoin Adoption Could Spell Trouble

The Bank of England just fired a warning shot across the bow of crypto innovators—and the UK's financial future might hang in the balance.

Governor throws cold water on stablecoin dreams

In a move that reeks of institutional panic, the BoE's top brass declared war on dollar-pegged tokens today. No specifics, no data—just the same tired 'systemic risk' playbook from people who still think fax machines are cutting-edge.

Meanwhile, real finance keeps evolving

While Threadneedle Street frets about imaginary volatility, decentralized exchanges processed $12B in stablecoin volume yesterday. But sure, let's pretend Tether is the problem—not the 300% inflation on your morning latte.

This isn't protection—it's paralysis. The UK either rides the digital asset wave or gets relegated to financial irrelevance. Your move, Westminster.

Andrew Bailey, Governor of the Bank of England and Chair of the Financial Stability Board, has issued a statement, warning banks against issuing their own stablecoins. In a recent interview, Bailey expressed concerns related to the risks of financial stability in digital currency.

Bank of England Warning Against Stablecoins 

Andrew Bailey’s comments addressed all the central bankers in the world who have called for stablecoin regulation. He expressed concerns that stablecoins could destabilize the financial system and undermine sovereign governments’ control over their currencies, leading to illicit activities. 

Citing the risks associated with cryptocurrency, Bailey suggested that the world’s central banks should pursue tokenized deposits, digital versions of traditional money, rather than adopting private-sector stablecoins or issuing central bank digital currencies (CBDCs). 

Bailey said, “I WOULD much rather [banks] go down the tokenised deposit streets and say, how do we digitise our money, particularly in payments.” 

Bailey Reiterates Digital Deposits 

In his interview, Bailey also said that he did not want the United Kingdom to adopt central bank digital currency (CBDC), also known as the ‘digital pound.’ He said it would be sensible for the UK to work towards digitizing deposits rather than adopting CBDCs. 

Bailey stressed his idea by diverging the UK’s view on digital money from the US’s views. He disagreed with US President Donald Trump’s idea on stablecoin, and said, “I would say that the US is going towards stablecoins. The European Central Bank is going towards central bank digital currency. Neither of them is going towards tokenising deposits.”

Final Thought 

Additionally, Bailey reiterated that cryptocurrencies are not actual money as they do not function like traditional money, advising investors to approach them cautiously. While the US is currently exploring digital currencies and making new laws to regulate stablecoins, UK authorities are issuing warnings against the potential risks associated with them.