A suite of documents was published in the United Kingdom on Nov. 6 that concern stablecoin regulation. The Financial Conduct Authority (FCA) released a discussion paper, as did the Bank of England (BOE). To accompany those, the BOE’s Prudential Regulatory Authority (PRA) released a letter to CEOs of deposit-taking institutions, and the BOE released a “cross-authority roadmap” to link them together.
His Majesty’s Treasury set the stage for the flurry of releases on Oct. 30 with a short document previewing plans for regulation. The FCA paper explored the same ground in much greater detail.
Stablecoin regulation is the first step to broader crypto asset regulation, the FCA said. The discussion paper outlined potential retail and wholesale stablecoin use cases. Its discussion included auditing and reporting, the backing of coins owned by the issuer and the independence of the backing assets’ custodian.
The paper concentrated on ways in which the principle of “same risk, same regulator outcome” could be applied. It proposed using the existing client assets regime as the basis of rules on redemption and custodianship and the senior management arrangements, systems and controls sourcebook to organize business affairs. There are existing operational resilience and financial crime frameworks, as well as numerous others.
The UK FCA is proposing that stablecoin holders have the right of direct redemption. Which makes issuers a lot more like banks and will raise a bunch of AML/KYC issues for issuers pic.twitter.com/lZLQXlmemu
The FCA is considering adapting existing prudential requirements for regulated stablecoin issuers and custodians from the existing regime and making them applicable to other crypto assets eventually.
The BOE paper looked at the use of sterling-based retail-focused stablecoin in systemic payment systems. It considered transfer function and requirements for wallet providers and other services, and it partially overlapped with the FCA’s discussion of stablecoin issuers and deposit protection.
The BOE will “rely on” the FCA to regulate custodians, it said, but it left open the possibility of imposing requirements of its own, if necessary. It pointed to Anti-Money Laundering and Know Your Customer requirements for unhosted wallets and off-chain transactions as potential regulatory sore points.
Proposed stablecoin regulatory landscape in the UK. Source: Bank of England
The BOE PRA letter emphasized that the difference between “e-money or regulated stablecoins” and other types of deposit have to be clearly maintained:
“With the emergence of multiple forms of digital money and money-like instruments, there is a risk of confusion among customers, especially retail customers, if deposit- taking entities were to offer e-money or regulated stablecoins under the same branding as their deposits.”
Deposit-taking institutions should limit their innovation to deposits. Issuance activities should have distinct branding, the PRA advised. An issuer that wants to take deposits as well should move quickly and involve the PRA in the process. Finally, innovations in deposit taking are also subject to rules and requirements, it reminded.
Stablecoin regulation timeline. Source: Bank of England Prudential Regulatory Authority
The BOE roadmap included a timeline, with an implementation date of 2025.
SEC Commissioner and head of the crypto task force, Hester Peirce, says US financial firms are navigating crypto in a way that’s similar to playing the children’s game “the floor is lava,” but in the dark.
“It is time that we find a way to end this game. We need to turn on the lights and build some walkways over the lava pit,” Peirce said at the SEC “Know Your Custodian” roundtable event on April 25.
The lava is crypto, says Peirce
Peirce explained that SEC registrants are forced to approach crypto-related activities like “the floor is lava,” where the aim is to jump from one piece of furniture to the next without touching the ground, except here, touching crypto directly is the lava.
“A D.C. version of this game is our regulatory approach to crypto assets, and crypto asset custody in particular,” she said.
Peirce said that, much like in the game, firms wanting to engage with crypto must avoid directly holding it due to unclear regulatory rules. “To engage in crypto-related activities, SEC-registrants have had to hop from one poorly illuminated regulatory space to the next, all while ensuring that they never touch any crypto asset,” Peirce said.
Peirce said that investment advisers are often unsure which crypto assets qualify as securities, what entities count as qualified custodians, and whether “exercising staking or voting rights” could trigger custody violations.
“The twist in the regulatory version is that it is largely played in the dark: burning legal lava and no lamps to illuminate the way.”
Peirce also said that a broker or ATS that cannot custody or manage crypto assets will struggle to facilitate trading, making it unlikely for a “robust market” to develop.
Echoing a similar sentiment, SEC Commissioner Mark Uyeda said at the event that as more SEC registrants work with crypto assets, it’s essential that they have access to custodial options that meet legal and regulatory requirements.
Uyeda said the agency should consider letting advisers use “state-chartered limited-purpose trust companies” with the authority to hold crypto assets as qualified custodians.
Meanwhile, the recently sworn-in chair of the SEC, Paul Atkins, said that he expected “huge benefits” from blockchain technology through efficiency, risk mitigation, transparency, and cutting costs.
He reiterated that among his goals at the SEC would be to facilitate “clear regulatory rules of the road” for digital assets, hinting that the agency under former chair Gary Gensler had contributed to market and regulatory uncertainty.
“I look forward to engaging with market participants and working with colleagues in President Trump’s administration and Congress to establish a rational fit-for-purpose framework for crypto assets,” said Atkins.
On the banks of the Mersey, Runcorn and Helsby is a more complicated political picture than the apparent Labour heartland that first presents itself.
Yes, there are industrial and manufacturing areas – an old town that’s fallen victim to out-of-town shopping, and an out-of-town shopping centre that’s fallen victim to Amazon.
But there are also more middle-class new town developments, as well as Tory-facing rural swathes.
Image: Space Cafe director Marie Moss says a sense of community has faded
One thing this area does mirror with many across the country, though, is a fed-up electorate with little confidence that politics can work for them.
In the Space Cafe in Runcorn Old Town, its director Marie Moss says many in the region remember a time when a sense of community was more acute.
“People were very proud of their town… and that’s why people get upset and emotional as they remember that,” she says.
It’s this feeling of disenfranchisement and nostalgia-tinged yearning for the past that Reform UK is trading off in its targeting of traditional Labour voters here.
More on Liverpool
Related Topics:
Party leader Nigel Farage features heavily on leaflets in these parts, alongside spikey messaging around migration, law and order, and Labour’s record in government so far.
Image: Runcorn 2024 result
Taxi driver Mike Holland hears frequent worries about that record from those riding in the back of his cab.
A Labour voter for decades, he says locals were “made up” at last year’s election result but have been “astonished” since then, with benefit changes a common topic of concern.
“Getting a taxi is two things, it’s either a luxury or a necessity… the necessity people are the disabled people… and a lot of the old dears are so stressed and worried about their disability allowance and whether they are going to get it or not get it,” he says.
But will that mean straight switchers to Reform UK?
Image: Taxi driver Mike Holland has voted for Labour for decades, but is now looking at the Lib Dems and Greens – or may not vote at all
Mike says he agrees with some of what the party is offering but thinks a lot of people are put off by Mr Farage.
He’s now looking at the Liberal Democrats and Greens, both of whom have put up local politicians as candidates.
Or, Mike says, he may just not vote at all.
It’s in places like Runcorn town that some of the political contradictions within Reform UK reveal themselves more clearly.
Many here say they were brought up being told to never vote Tory.
And yet, Reform, chasing their support, has chosen a former Conservative councillor as its candidate.
It’s no surprise Labour has been trialling attack lines in this campaign, painting Mr Farage’s party as “failed Tories”.
As a response to this, look no further than Reform’s recent nod to the left on industrialisation and public ownership.
Spreaker
This content is provided by Spreaker, which may be using cookies and other technologies.
To show you this content, we need your permission to use cookies.
You can use the buttons below to amend your preferences to enable Spreaker cookies or to allow those cookies just once.
You can change your settings at any time via the Privacy Options.
Unfortunately we have been unable to verify if you have consented to Spreaker cookies.
To view this content you can use the button below to allow Spreaker cookies for this session only.
But head 15 minutes south from Runcorn docks, and this by-election campaign changes.
Rural areas like Frodsham and Helsby have, in the past, tended towards the Tories.
The Conservatives, of course, have a candidate in this vote, one who stood in a neighbouring constituency last year.
But Reform is now making a hard play for their supporters in these parts, with a softer message compared to the one being put out in urban areas – an attempt to reassure those anxious about too much political revolution coming to their privet-lined streets.
Labour, meanwhile, is actively trying to mobilise the anti-Farage vote by presenting their candidate – another local councillor – as the only person who can stop Reform.
Image: Makeup artist Nadine Tan is concerned about division and anger in the community
The pitch here is aimed at voters like Frodsham makeup artist Nadine Tan, who are worried about division and anger in the community.
“I think they need to kind of come together and stop trying to divide everyone,” she says.
But like Mike the taxi driver five miles north, disillusionment could be the eventual winner as Nadine says, despite the “thousands of leaflets” through her door, she still thinks “they all say the same thing”.
One factor that doesn’t seem to be swinging too many votes, though, is the insalubrious circumstances in which the area’s former Labour MP left office.
Image: Labour MP Mike Amesbury was convicted of punching a man in the street. Pic: Reuters
But across the patch, many praise their ex-MP’s local efforts, while also saying he was “very silly” to have acted in the way he did.
That may be putting it mildly.
But it’s hard to find much more agreement ahead of Thursday’s vote.
A constituency still hungry for change, but unsure as to who can deliver it.
Full list of candidates, Runcorn and Helsby by-election:
Catherine Anne Blaiklock – English Democrats Dan Clarke – Liberal Party Chris Copeman – Green Party Paul Duffy – Liberal Democrats Peter Ford – Workers Party Howling Laud Hope – Monster Raving Loony Party Sean Houlston – Conservatives Jason Philip Hughes – Volt UK Alan McKie – Independent Graham Harry Moore – English Constitution Party Paul Andrew Murphy – Social Democratic Party Sarah Pochin – Reform UK Karen Shore – Labour John Stevens – Rejoin EU Michael Williams – Independent
Solana decentralized finance (DeFi) protocol Loopscale has temporarily halted its lending markets after suffering an approximately $5.8 million exploit.
On April 26, a hacker siphoned approximately 5.7 million USDC (USDC) and 1200 Solana (SOL) from the lending protocol after taking out a “series of undercollateralized loans”, Loopscale co-founder Mary Gooneratne said in an X post.
The exploit only impacted Loopscale’s USDC and SOL vaults and the losses represent around 12% of Loopscale’s total value locked (TVL), Gooneratne added.
Loopscale is “working to resume repayment functionality as soon as possible to mitigate unforeseen liquidations,” its said in an X post.
“Our team is fully mobilized to investigate, recover funds, and ensure users are protected,” Gooneratne said.
In the first quarter of 2025, hackers stole more than $1.6 billion worth of crypto from exchanges and on-chain smart contracts, blockchain security firm PeckShield said in an April report.
More than 90% of those losses are attributable to a $1.5 billion attack on ByBit, a centralized cryptocurrency exchange, by North Korean hacking outfit Lazarus Group.
Launched on April 10 after a six-month closed beta, Loopscale is a DeFi lending protocol designed to enhance capital efficiency by directly matching lenders and borrowers.
It also supports specialized lending markets, such as “structured credit, receivables financing, and undercollateralized lending,” Loopscale said in an April announcement shared with Cointelegraph.
Loopscale’s order book model distinguishes it from DeFi lending peers such as Aave that aggregate cryptocurrency deposits into liquidity pools.
Loopscale’s main USDC and SOL vaults yield APRs exceeding 5% and 10%, respectively. It also supports lending markets for tokens such as JitoSOL and BONK (BONK) and looping strategies for upwards of 40 different token pairs.
The DeFi protocol has approximately $40 million in TVL and has attracted upwards of 7,000 lenders, according to researcher OurNetwork.