Bailey urges global stablecoin rules as nations diverge

Bank of England Governor Andrew Bailey called for a single international regulatory framework for stablecoins at an Institute of International Finance event on Wednesday. Bailey, who also chairs the Financial Stability Board, noted progress on global standards has slowed even as stablecoins are used more across the financial system.

He said stablecoins rely on public trust that holders can redeem tokens for full value at any time, a concept he labeled “assured value.” Bailey warned that different national rules could threaten that redeemability and urged greater alignment among jurisdictions.

In Washington, the Treasury Department on April 8 published a notice of proposed rulemaking from the Financial Crimes Enforcement Network and the Office of Foreign Assets Control under the GENIUS Act. The proposal would require permitted payment stablecoin issuers, or PPSIs, to implement anti‑money‑laundering and sanctions compliance programs with senior management oversight, carry out financial crime risk assessments, apply risk‑based customer due diligence, appoint a responsible AML/CFT officer, provide staff training, and subject AML controls to independent audit and testing. The regime is scheduled to take full effect in January 2027.

The United Kingdom is developing its own approach while other countries consider different models. In South Korea, lawmakers, the central bank and the banking sector are debating whether technology companies should be permitted to issue won‑pegged stablecoins or whether issuance should be limited to banks. The dispute has political dimensions: President Lee Jae‑myung pledged won‑pegged stablecoins during his campaign and has pursued legislation, but the administration has faced resistance from banks and the Bank of Korea.

Circle CEO Jeremy Allaire traveled to Seoul this week and met with lawmakers, banking executives and local crypto firms. He told reporters Circle has no current plan to launch a won‑pegged token, but said the company would seek a license and establish a South Korean branch if a legal pathway is created. He offered Circle’s technical support to local issuers should regulators allow wider participation.

U.S. and U.K. officials have framed parts of the regulatory push around preventing illicit finance. The U.S. proposal aligns stablecoin issuers with the financial crime compliance duties that apply to other U.S. financial institutions once the GENIUS Act regime is fully active. Regulators and market participants have highlighted the need for cross‑border coordination to limit inconsistent rules as stablecoins are used for payments and settlement.