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In brief

In a long-awaited update on its plans for the UK’s crypto regulatory framework, on 30 October 2023, HM Treasury issued three interlinked policy documents on the future regulation of crypto, covering fiat-backed stablecoins, the wider cryptoasset regulatory regime, and the failure of systemic digital settlement asset (DSA) firms. The regulators followed shortly after, issuing a set of papers on 6 November 2023 on the forthcoming stablecoin regime: a discussion paper from the FCA on stablecoin regulation, a discussion paper from the Bank of England (BoE) on the regulation of systemic payment systems using stablecoins, a PRA Dear CEO Letter to deposit-takers on issues relating to digital money, and a cross-authority roadmap paper on innovation in payments and money (which explains how the regimes interact and the regulators’ approach to dual regulation). Both discussion papers close to comments on 6 February 2024.

This briefing covers stablecoin regulation and the failure of systemic DSA firms – for more on the wider cryptoasset regulatory regime, see our dedicated alert issued alongside this one: United Kingdom: The future of crypto regulation – Treasury provides clarity on the wider regime.

The Treasury’s stablecoin policy update sets out more detail on the government’s plan to regulate certain activities relating to fiat-backed stablecoins, almost 18 months after it first confirmed its plans to move forward with the regulation of stablecoins in the UK; for more on the Treasury’s announcements at the time, see our related client alert. Whilst the update essentially confirms the approach previously set out by the Treasury, there are some evolving details and clarifications worth exploring. However, although the Treasury has already started to prepare for stablecoin regulation through the Financial Services and Markets Act 2023 (which contains measures allowing the Treasury to bring activities relating to fiat-backed stablecoins within the regulatory perimeter), it remains the case that most of the detailed requirements of the regime are left to the forthcoming secondary legislation and rules issued by the regulators. The FCA and BoE discussion papers give a helpful indication of how the finer details of the regime will shake out, but there is plenty of room for the regulators to manoeuvre, and further consultations to follow before the shape of regulation is fully set.

Click here to access the full alert.


Mark heads the Financial Services & Regulatory (FSR) practice group in London and co-leads the FinTech group. He also acts as Chair of the FSR practice for the EMEA region and sits on the Global FSR Steering Committee. Mark is ranked as a Leading Individual in Legal 500 2022 for Financial Services (Non-Contentious Regulatory) and is individually ranked in Chambers 2022 for FinTech. He is described in these publications as being "very knowledgeable" and "very approachable" with "a wonderful range of FinTech experience" and as someone who is "clear, commercial and pragmatic and understands all the issues in detail." He has authored a number of articles and contributions for leading journals and other publications, most notably the Journal of International Banking and Financial Law, the International Guide to Money Laundering Law and Practice, and A Practitioner's Guide to the Law and Regulation of Financial Crime.


Sarah Williams is an associate in the financial services practice in London. Sarah advises a broad range of clients on financial services legal and regulatory issues. Sarah's practice includes advising on the regulation of payment services and electronic money, investment firms and consumer credit providers and anti-money laundering compliance issues.


Melody Hoay is an associate in the Financial Services & Regulatory Group in the London office. Melody's regulatory experience covers payments, cryptocurrency, ESG, capital markets, asset management, financial advisory and anti-money laundering work in the UK and Singapore. Prior to joining Baker McKenzie, Melody practised law at one of the largest leading law firms in Singapore in the financial regulatory and fintech team, and through that capacity was also a member of the legal team sitting on the ExCo of the Singapore FinTech Association in 2021. Melody has also given various talks on financial regulation, including two guest lectures on cryptocurrency regulation at a Singapore university. Melody graduated from the University of Oxford with a B.A. (Hons) in jurisprudence in 2017. She also topped the national Singapore Bar Examinations in 2019 and qualified in Singapore.


Kimberly Everitt is Baker McKenzie's knowledge lawyer for Financial Services Regulation & Enforcement, covering the EMEA region, and brings over a decade of experience to the team in both knowledge and fee-earning roles. Prior to joining Baker McKenzie, Kim held roles specializing in contentious financial services regulation knowledge, and her fee-earning roles covered non-contentious regulation in the private equity and general financial services sectors.

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