US, UK taskforce outlines joint stablecoin and tokenization rules
The US and UK have directed their financial regulators to align rules on stablecoins and tokenized assets, a move that could reduce market fragmentation and ease cross-border capital raising.
The US Department of the Treasury and HM Treasury released joint recommendations on Tuesday through the Transatlantic Taskforce for the Markets of the Future. The guidance tasks regulators in both countries with establishing frameworks for tokenized assets and exploring avenues for cross-border capital formation.
The taskforce specifically directed the Bank of England, the UK Financial Conduct Authority, the US Commodity Futures Trading Commission, and the US Securities and Exchange Commission to coordinate their approaches. By aligning these regulatory regimes, the two governments aim to reduce the market fragmentation that has historically complicated operations for digital asset firms operating across the Atlantic. "The United States and the UK should leverage their positions as leading global financial centers to actively shape the development of digital asset markets and next-generation financial infrastructure," the two governments said.
A core focus of the roadmap is fostering competition in stablecoins and tokenized deposits. For financial institutions and fintech firms, harmonized rules would lower the compliance costs of issuing these instruments internationally. However, the treasuries emphasized that any innovation must be paired with strict baseline standards for custody, reserve segregation, and consumer protections.
To protect investors, the joint statement outlined specific bankruptcy priorities for digital assets. "Each government endeavors to create a framework that, in the event of insolvency, bankruptcy, restructuring, or resolution proceeding, provides for stablecoin holders a clear and protected legal claim on reserves, including priority ahead of other creditors, consistent with the laws of each jurisdiction," they said.
This transatlantic push arrives as US federal agencies draft implementation rules for the GENIUS Act, the US stablecoin law that turns one year old this week. That legislation requires stablecoins to be fully backed by US dollars or equivalent liquid assets. It also mandates annual audits for issuers exceeding a $50 billion market capitalization and sets specific parameters for foreign issuance.
Federal Reserve Chair Kevin Warsh indicated on Tuesday that regulators are working swiftly to meet an upcoming July 18 deadline for these rule proposals. "We're racing to put that out by this deadline," Warsh said during a House Financial Services Committee hearing.
