On August 4, the U.S. Department of the Treasury published a joint statement summarizing discussions held on July 8 in London during a meeting of the U.S.-U.K. Financial Regulatory Working Group. The statement outlines coordinated efforts to advance cryptocurrency regulation, modernize payment systems, ensure financial stability, and reform capital markets in both jurisdictions, as well as clarifying shared transatlantic regulatory priorities.
Senior representatives included officials from both countries' finance ministries, the Bank of England, the Federal Reserve, the Financial Conduct Authority (FCA), and several U.S. financial regulators. Digital assets were a central topic of discussion alongside payments modernization, financial stability, artificial intelligence, capital markets, banking supervision, and cross-border financial cooperation.
The U.S. Treasury stated:
"Authorities provided updates on their respective regulatory frameworks for digital assets, including stablecoins, and on their work on broader payments modernization."
The Treasury added: "U.S. authorities provided an update on the implementation of the $GENIUS Act regarding stablecoins and on a digital asset market structure framework."
U.K. officials outlined their "Digital Securities Sandbox" strategy, including the appointment of Christopher Woolard CBE as the U.K.'s "Wholesale Digital Markets Coordinator."
The talks followed recommendations from the Transatlantic Future Markets Task Force published on July 14. Those recommendations aim to reduce unnecessary cross-border barriers, improve supervisory cooperation, expand capital-raising opportunities, and clarify the approach to regulating tokenized financial activity.
Crypto Rules Move Toward Comparable Standards
The governments endorsed regulatory approaches designed to support digital money while protecting consumers, market confidence, and financial stability. Their joint statement on stablecoins supports their cross-border use, a comparable approach to similar risks, and the holding of reserves on at least a "one-to-one" basis in high-quality liquid assets for stablecoins presented as money.
Stablecoins are digital assets designed to maintain a stable value, typically through reserves pegged to fiat currencies or other assets. Their growing role in payments, trading, and settlement has brought them into the regulatory spotlight in major financial markets.
The Federal Deposit Insurance Corporation (FDIC) proposed implementation standards for the $GENIUS Act, covering reserves, redemption, capital, liquidity, risk management, custody, and safekeeping. The corresponding requirements would transition from statutory authorization to operating rules for regulated payment stablecoin issuers in the U.S.
This transition includes proposed standards for qualifying one-to-one reserves and redemption standards intended to ensure predictable access to customer funds. The FDIC's framework for bank-issued stablecoins also mandates redemption within two business days and supervisory requirements covering financial and operational risks.
Tokenization Attracts Major Financial Institutions
U.K. authorities are developing a unified approach to tokenized wholesale markets, where blockchain-based records can represent securities, deposits, collateral, and other financial instruments. The U.K.'s concept for tokenized markets aims to improve post-trade processing, collateral mobility, market efficiency, and interoperability between financial infrastructure elements.
Major financial institutions are already engaged in this transition through an industry initiative bringing together 54 firms, including Blackrock, JPMorgan, exchanges, asset managers, and technology providers. The U.K.'s Institutional Tokenization Working Group is exploring commercial applications and regulatory conditions for digital securities, tokenized funds, and blockchain-based settlement.
Digital Payments and Systemic Stablecoins Take Shape
Payments policy remains another core component of the bilateral agenda, with officials endorsing regulated private digital money for international markets. The countries' shared approach to cross-border digital payments aims to limit regulatory fragmentation while ensuring competition among stablecoins, tokenized deposits, and other payment instruments.
The Bank of England published a draft regime for stablecoins that could function at a systemic scale within the U.K. economy. The framework envisions a provisional issuance limit of £40 billion for each systemic stablecoin, unrestricted use by individuals and businesses, and reserve requirements.
Officials expect the Financial Regulatory Working Group to reconvene in early 2027, continuing the twice-yearly dialogue established in 2018. Future meetings will address regulatory cooperation, investor protection, capital formation, financial stability, and the development of fair, orderly, and efficient markets.
