US, UK Treasuries to Align Transatlantic Rules on Tokenization and Stablecoins

The US Department of the Treasury and HM Treasury released a set of recommendations as part of the Transatlantic Taskforce for the Markets of the Future, which included stablecoin activity and tokenized finance.

In a joint statement on Tuesday, the two treasury entities issued four recommendations focused on digital assets as part of bilateral cooperation between the two countries on financial markets. The task force recommended that authorities consider a private-sector-led group focused on “testing of cross-border use cases for tokenized assets” and that financial agencies in the US and the Bank of England identify shared approaches on the regulation of tokenized assets. 

On stablecoins, the US and UK released a joint statement aimed at regulatory alignment and establishing a “dynamic stablecoin market across borders.” 

“Each government intends to tailor its requirements to seek comparable outcomes for comparable risks and activities, seeking to advance financial stability while avoiding market distortions or disincentivizing cross-border competition,” said the statement.

The Treasury statement did not explicitly mention the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, signed into law last year and waiting for regulations to be approved before its effective date in January 2027. However, the US-UK recommendations said stablecoins “should be fully backed, on at least a one-to-one basis, by high-quality, liquid assets,” aligning with the US law.

Related: UK government defers capital gains on certain crypto with ‘no gain, no loss’ approach

Report signals tokenization could add $44 billion to UK economic output

The US-UK statement followed a report that the United Kingdom could add up to $44 billion to its annual economic output by 2035, “provided the UK is one of the leading jurisdictions for tokenization, tokenization scales globally, and UK domestic adoption increases in line with major peers.“

The report, from a UK government-backed industry task force, called on the country to issue tokenized bonds by the first quarter of 2027 and plans to test financial transactions on the blockchain.

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