In brief
- Digital assets will have a transformative impact on U.K. financial markets, said Economic Secretary to the Treasury Lucy Rigby.
- She highlighted their improvements to efficiencies including quicker capital flows.
- Rigby pointed to the need to “minimize frictions” between the U.K. and U.S. regulatory regimes for digital assets.
Digital assets have the potential to effect sweeping changes on U.K. financial markets, according to Lucy Rigby, Economic Secretary to the Treasury.
Speaking at the Financial Times Digital Assets Summit, Rigby said that digital assets offer benefits including “efficiencies generally, but also just everything happening much more speedily.” She added that it’s important to consider “what that actually means for business,” including quicker capital flows and “capital being freed up for other things.”
More broadly, Rigby argued, digital assets have “the potential for complete transformation of our markets, and that goes beyond efficiencies,” noting that the Treasury has to “work very closely with industry, with regulators, and give some proper thought to exactly how digital assets do transform our financial markets.”
Her comments come as the King’s Speech introduces an Enhancing Financial Services Bill, which Rigby noted “contains major reforms that are going to drive growth in our financial services sector.” They include provisions that seek to “modernise how the sector is regulated,” highlighting the need to ensure that the “administrative burden on firms is proportionate.”
Within the digital assets sector, Rigby pointed to the FCA and Bank of England’s upcoming stablecoin legislation, with the portal allowing for authorizations set to open “later this year.” She also highlighted the stablecoin regulatory sandbox launched by the FCA earlier this year, with four firms who are “keen to get a GBP stablecoin out there,” as well as the imminent publication of a consultation inviting the payments sector to provide feedback on a “single, coherent framework for both traditional and tokenised payments” including stablecoins and tokenized deposits.
“This is really about streamlining regulation in the payment space,” she said, encompassing both stablecoins and AI agents.
The Economic Secretary also pointed to the need to “minimize frictions” between the U.K. and U.S. regulatory regimes for digital assets, adding that it “may well take the form of some forms of recognition or alignment.”
Rigby added that digital assets are set to be a feature of the U.K.’s financial landscape, saying, “I’m pretty clear that’s what the future looks like. Given that, she added, “we need to embrace those forms of innovation, and we need to be doing it in the right way.”
