UK Lawmakers Launch Inquiry Into Stablecoin Expansion Amid Bank of England Warnings
The House of Lords Financial Services Regulation Committee has initiated a formal inquiry into the risks and opportunities posed by stablecoins, as the Bank of England warns of potential deposit drain from traditional banks. The probe will assess whether current regulatory proposals strike the right balance between innovation and financial stability.
Focus areas include the evolution of sterling-denominated and dollar-pegged stablecoins, their role in payments and savings, and comparisons with regulatory frameworks in the U.S. and EU. Evidence submissions are open until March 11, with hearings to follow.
Baroness Noakes emphasized the need to evaluate how stablecoins might reshape financial markets—a question that remains unresolved since their inception over a decade ago.
