Bank of England Plans Digitalization with Regulated Stablecoins by 2026

The Bank of England's Deputy Governor for Financial Stability, Sarah Breeden, outlined a vision for the digitalization of the UK's financial system at the 2026 London City Week conference. According to ChainCatcher, Breeden emphasized the integration of regulated stablecoins as a key component. The bank plans to release draft rules for systemic stablecoins next month, with finalization expected by the end of the year. Breeden highlighted that future retail payment systems should incorporate various interchangeable currency forms, including digital deposits and stablecoins. She noted that shared ledger technology could reduce payment costs and accelerate processing times by minimizing intermediaries. Additionally, smart contracts could enhance retail payment efficiency through customization, conditionality, and automation. Breeden also stressed the Bank of England's commitment to supporting the responsible adoption of AI technology, particularly in facilitating payments and commercial transactions.