US-UK Pact Sets Stablecoin Reserves, Tokenization Roadmap

American and British regulators are expanding their cooperation on digital assets, stablecoins, and tokenization, aiming to reduce cross-border friction and modernize the two largest financial markets, according to a joint statement published Aug. 4 by the U.S. Treasury.

The statement summarized discussions from the July 8 U.S.-U.K. Financial Regulatory Working Group meeting in London. Senior officials from both Treasury departments, the Bank of England, the Federal Reserve, the Financial Conduct Authority, and several U.S. financial regulators attended.

U.S. authorities provided an update on implementing the GENIUS Act for stablecoins and on digital asset market structure, the Treasury said. The Federal Deposit Insurance Corporation has proposed implementation standards covering reserves, redemptions, capital, liquidity, and custody for bank stablecoin issuers. Those standards include a two-business-day redemption expectation and one-to-one eligible reserve requirements.

British officials outlined their Wholesale Financial Markets Digital Strategy, including Christopher Woolard’s appointment as wholesale digital markets champion. The United Kingdom is developing a unified approach to tokenized wholesale markets, where blockchain records represent securities, deposits, and collateral. A 54-company industry initiative involving BlackRock, JPMorgan, exchanges, and asset managers is already participating.

The joint statement supported cross-border use of stablecoins and called for comparable treatment of similar risks. It recommended reserves of at least one-to-one high-quality liquid assets for stablecoins presented as money. The Bank of England has published draft requirements for systemic stablecoins, including a temporary £40 billion issuance guardrail per stablecoin. Unrestricted use by individuals and businesses would be allowed under the framework.

Payment policy is another central component. The countries support regulated private digital money across international markets, aiming to limit regulatory fragmentation while allowing competition among stablecoins, tokenized deposits, and other payment instruments.

The Financial Conduct Authority published its final cryptoasset rulebook on June 30, lowering the capital floor for stablecoin issuers. The rulebook sets out conduct requirements and prudential standards for firms operating in the UK crypto market.

The talks preceded recommendations from the Transatlantic Taskforce for Markets of the Future, published July 14. Those recommendations seek to reduce unnecessary cross-border friction, improve supervisory cooperation, and clarify regulatory treatment for tokenized financial activity.

Both governments have endorsed regulatory approaches designed to support digital money while protecting consumers, market confidence, and financial stability. The joint statement on stablecoins supports comparable treatment of similar risks across jurisdictions.

The working group is expected to reconvene in early 2027, continuing the biannual dialogue established in 2018.