Thirty Crypto Execs Urge UK to Adopt National Stablecoin Strategy to Avoid Falling Behind US

Thirty crypto executives from leading firms, including Coinbase, Kraken, and VanEck, have urged the UK government to establish a national stablecoin strategy to avoid being left behind in the global crypto race, particularly by the U.S. In a letter addressed to Finance Minister Rachel Reeves, they emphasized that without immediate regulatory clarity and a coordinated plan, the UK risks becoming a mere "rule-taker" rather than a "rule-maker" in the digital asset era [1]. The letter, submitted on Wednesday, calls for stablecoins to be integrated into the UK’s financial infrastructure, rather than being treated as isolated risks [2].

The group criticized the UK’s current legal definition of stablecoins as “crypto-assets with reference to fiat currency,” a term they argue is as outdated as calling a cheque “paper with reference to currency.” Instead, they contend that stablecoins should be recognized as functional digital payment rails that are already embedded in the global movement of crypto [3]. This misalignment with the actual use of stablecoins, the letter argues, is stalling innovation and limiting the UK’s ability to capitalize on the growing market.

The pound-pegged stablecoin market is currently minuscule, with a total market cap of just £461,224—far behind the U.S.-dollar-backed stablecoins like Tether’s USDT and Circle’s USDC, which dominate the $280 billion global stablecoin market [1]. The letter attributes this underperformance to the UK’s regulatory hesitation, warning that such an environment risks locking the country out of key financial innovations and revenue opportunities.

Industry leaders also acknowledged past failures in the stablecoin space, such as the 2022 collapse of Terra and Luna, which exposed the risks of algorithmic models. However, they stressed that these incidents do not negate the broader utility and necessity of stablecoins in the crypto ecosystem. Daragh Maher, HSBC’s head of digital assets research, noted that stablecoins serve as the “cash equivalent” of crypto and are essential for fast, efficient blockchain-based transfers [2]. He added that the key to unlocking their potential lies in the development of a supportive regulatory environment.

Meanwhile, the U.S. has been moving forward with legislative efforts to create a more structured framework for stablecoins. The GENIUS Act, for example, requires stablecoins to be fully backed by U.S. dollars or equivalent assets and mandates regular audits for large issuers. In parallel, the House passed the CLARITY Act, expanding the CFTC’s authority over crypto trading [3]. These developments suggest a more institutional approach in the U.S., further highlighting the urgency for the UK to act.

The crypto industry’s letter makes it clear that regulation need not stifle innovation—it can instead support the UK’s ambitions to remain a global financial hub. By embracing stablecoins as part of its financial infrastructure, the UK could attract investment, foster talent, and enhance its competitiveness in the digital economy. The time, the letter argues, is now [1].

Source:

[1] Crypto execs urge UK to create national stablecoin strategy ... (https://www.mitrade.com/insights/news/live-news/article-3-1056114-20250821)

[2] Crypto industry urges U.K. to embrace stablecoins as ... (https://seekingalpha.com/news/4487561-crypto-industry-urges-uk-to-embrace-stablecoins-as-financial-infrastructure---report)