BoE's Wilkins: Dollar Stablecoins Hold 98% of Market — SkimNews
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- BoE official Wilkins said stablecoin growth could boost dollar dominance and US Treasury demand, noting the US dollar accounts for 98% of stablecoin value — what he described as a 'considerable first-mover advantage.'
- Stablecoin circulation has surpassed $300 billion globally, with the market remaining overwhelmingly tied to the US dollar.
- Pound-denominated stablecoins have gained far less traction, though UK regulators have taken several steps this year to encourage their development.
- The Financial Conduct Authority began testing prospective stablecoin issuers through a dedicated regulatory sandbox and finalized UK stablecoin issuance rules in June.
- The Bank of England is experimenting with digital money, including a recent test pairing stablecoins with a simulated digital pound for cross-border trade payments.
- The BoE has shifted to a more accommodating stance on stablecoins after industry criticism that its proposed rules could stifle innovation.
Why it matters: With 98% of stablecoin value dollar-denominated, the US holds a structural advantage in the next phase of digital money — and the BoE's pivot to a more accommodating stance alongside FCA rule-making and digital pound experiments signals the UK is racing to build a parallel pound-based ecosystem before the gap becomes permanent.
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