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FCA launches stablecoin sandbox cohort as UK readies full crypto regime
26 November 2025 UK
Image: Kate3155/stock.adobe.com
The UK’s Financial Conduct Authority (FCA) has launched a stablecoin-specific cohort within its Regulatory Sandbox, opening applications immediately as it accelerates work on a full regulatory regime for digital assets and stablecoin issuance.
Speaking at City & Financial Global, David Geale, FCA executive director for payments and digital assets, said the cohort will allow firms to test UK-issued stablecoins under live conditions, generating practical evidence to shape the final rules.
Applications close on 25 January, with the FCA already admitting its first participant — a major firm preparing to test a sterling-denominated payments stablecoin, described as “a world first”.
The regulator is also introducing in-person policy sprints in March, bringing together traditional finance, payments firms and fintechs to examine retail and wholesale stablecoin use cases.
The findings will help determine where regulation is required, and where new models may instead rely on market-led standards.
Geale said the UK aims to build a “trusted, competitive, and innovative” crypto and stablecoin market, confirming the FCA is preparing a full gateway for firms seeking authorisation.
The next phase of consultations — covering consumer duty, market abuse, regulatory reporting, and disclosure — is due early next year, completing the proposed framework for custody, prudential requirements, and operational resilience.
He also confirmed the FCA intends to extend bank-level operational resilience rules across all cryptoasset firms, citing the sector’s technological dependencies and cross-border risks.
Geale reiterated the regulator’s message to prospective issuers: “We are open for business,” urging firms to engage early through pre-application meetings as the UK prepares to bring stablecoins formally into the regulatory perimeter.
Speaking at City & Financial Global, David Geale, FCA executive director for payments and digital assets, said the cohort will allow firms to test UK-issued stablecoins under live conditions, generating practical evidence to shape the final rules.
Applications close on 25 January, with the FCA already admitting its first participant — a major firm preparing to test a sterling-denominated payments stablecoin, described as “a world first”.
The regulator is also introducing in-person policy sprints in March, bringing together traditional finance, payments firms and fintechs to examine retail and wholesale stablecoin use cases.
The findings will help determine where regulation is required, and where new models may instead rely on market-led standards.
Geale said the UK aims to build a “trusted, competitive, and innovative” crypto and stablecoin market, confirming the FCA is preparing a full gateway for firms seeking authorisation.
The next phase of consultations — covering consumer duty, market abuse, regulatory reporting, and disclosure — is due early next year, completing the proposed framework for custody, prudential requirements, and operational resilience.
He also confirmed the FCA intends to extend bank-level operational resilience rules across all cryptoasset firms, citing the sector’s technological dependencies and cross-border risks.
Geale reiterated the regulator’s message to prospective issuers: “We are open for business,” urging firms to engage early through pre-application meetings as the UK prepares to bring stablecoins formally into the regulatory perimeter.
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