John Glen, the UK Minister for Financial Services, He said stablecoins will be the main focus of the government’s crypto-regulatory activities.
Glen spoke out about a conference hosted Tuesday by City Financial Global, according to Reuters.
For Glen, the UK’s decision to give stablecoin priority over general financial market regulation stems from fears that monopolies will emerge in the market based on the limited number of participants offering fiat-linked cryptocurrency payment services.
“There is a chance that some companies will quickly become dominant and displace other players because of their ability to scale and connect to existing online services.”Glen commented.
Indeed, the minister’s argument reflects the views defended by various financial regulators against the Stablecoin Diem project. Regulators in various countries pointed to Facebook’s global presence as a significant risk factor for government monetary policy associated with the planned digital currency project.
For his part, Diem has tried to smooth out these normative wrinkles by making extensive changes to the project. The project has not yet received the necessary regulatory approval to begin rolling out its stablecoin.
Glen’s comments are the latest indication of the UK government’s approach to stable coins as part of an effort to encourage new innovations in financial technology as the country leaves the European Union.
In November 2020 Rishi Sunak, Minister of Finance, commented that Brexit will mark a turning point for the UK financial services industryAt this time Sunak announced that the government would prioritize the use of novel fintech innovationssuch as digital currencies and central bank stable coins, to ensure the country keeps up with developments in the emerging digital economy.
As previously reported by Cointelegraph, The UK’s Financial Policy Department requested a public consultation on the proposed rules for cross-border stablecoins in January 2021.