UK financial institutions: Stablecoin regulatory positioning and payment integration will be core issues in UK crypto regulation in 2026.

According to Odaily Planet Daily, UK financial institutions recently reviewed the progress of UK crypto regulation in 2025 and looked ahead to key policy directions in 2026. UK Finance pointed out that in the past year, the UK has seen intensive discussions on issues such as stablecoins, crypto asset trading platforms (CATPs), and the prevention of market manipulation. The regulatory focus is gradually shifting from "unanchored crypto assets" to stablecoins backed by real-world assets.

UK Finance states that regulators are increasingly viewing stablecoins as instruments with payment and monetary attributes, rather than simply investment-grade crypto assets. This classification will directly impact redemption timelines, KYC requirements, and issuer compliance costs. It also cautions that if the regulatory burden on sterling stablecoins is higher than that on non-sterling stablecoins issued overseas, it could induce issuers to relocate, weakening the UK's control over stablecoins and monetary policy.

Furthermore, UK Finance points out that the core challenge in 2026 lies in striking a balance between encouraging innovation, protecting consumers, and maintaining the resilience of the financial system. This includes systemic stablecoin redemption rules, multi-currency and multi-issuance structure design, and the integration of stablecoins with traditional payment methods in payment scenarios. With the Financial Conduct Authority (FCA) launching a regulatory sandbox for non-systemic stablecoins, the UK is entering the policy implementation phase. Whether the final regulatory framework can balance innovation and competitiveness will determine whether London can maintain its status as an international financial center. (Crowdfund Insider)