UK Crypto Regulation: Circle’s Dante Disparte Expresses Confidence That Stablecoin Laws Are Imminent

Dante Disparte, Circle’s global head of policy, expressed confidence that formal laws for stablecoins—a type of cryptocurrency pegged to

Dante Disparte, Circle’s global head of policy, is optimistic that formal laws for stablecoins—a type of cryptocurrency pegged to traditional currencies like the US dollar or the British pound—are coming soon.

“I think we’re within months, not years,” Disparte toldDecrypt during an interview in London.

His optimism reflects a growing sense of urgency among policymakers to establish a regulatory framework for digital assets. Disparte also thinks the UK’s cautious approach to crypto regulation has paid off, especially in light of recent industry turmoil.

The UK has been notably deliberate in its rollout of crypto laws, a move that Disparte suggested many in the UK now feel vindicated for—especially after events like the collapse of FTX, a crypto exchange that was once valued at $32 billion.

“Many in the UK and other countries would argue that they’re vindicated in not having jumped in too quickly,” he said.

The regulatory clarity that the UK has—by not enacting stablecoin-specific regulations—could put it behind other regions, like the European Union, which is already enforcing rules under its Markets in Crypto Assets (MiCA) framework. Singapore has also put in place formal laws for the stablecoin industry.

“In the spirit of protecting the U.K. economy from excess risk and crypto, there’s also a point in time in which you end up protecting the economy from job creation and the industries of the future,” said Disparte, referring to how stablecoins can aid the banking sector with real-time payments and the digitization of the British pound, an effort that could revolutionize financial transactions.

The Bank of England is also exploring the possibility of a digital pound, which is sometimes referred to as “Britcoin.” Disparte said he met with officials from the Bank and was reassured by their thoughtful approach to central bank digital currencies (CBDCs).

Circle is actively engaging with UK authorities to advocate for clear and effective stablecoin regulations, and its involvement highlights the importance of collaboration between the private sector and regulators in shaping the future of digital finance.

Previous administrations had grand ambitions for the UK to become a global crypto hub. Under former Prime Minister Rishi Sunak, plans were announced to make the UK a “world leader” in the crypto space, aiming to introduce legislation for stablecoins and consult on regulating crypto asset trading. In April, the government outlined intentions to bring stablecoins into the regulatory fold, reflecting a proactive stance towards digital currencies.

The new Labour government has been less vocal on crypto regulation compared to its predecessors. In January, the party released a financial services plan that included a proposal to position the UK as a hub for securities tokenization.

Securities tokens represent ownership of real-world financial assets, such as shares or bonds, in digital form. This move indicates a shift towards embracing blockchain technology within traditional financial markets.

Stablecoins represent a large segment of the cryptocurrency market, with a total value exceeding $170 billion. Tether’s USDT is the largest stablecoin, boasting a market capitalization of over $120 billion. Circle’s USDC is the second-largest, with coins in circulation worth more than $34 billion.

Despite their prominence, stablecoins have not been without their controversies. In 2022, Tether’s USDT briefly lost its $1 peg following the collapse of a rival stablecoin, terraUSD. This event raised concerns about the stability and backing of these digital assets.

It’s crucial to ensure that stablecoins are fully backed by reserves for them to gain widespread acceptance. Tether asserts that dollars and dollar-equivalent assets, including government bonds, always back its coin.

Implementing robust regulations can enhance transparency and trust in the stablecoin market, protecting consumers and investors. As the UK contemplates its next steps, industry leaders like Circle hope regulations will be enacted soon.

Introducing stablecoin laws could help position the UK as a leader in digital finance, fostering innovation and attracting investment.

“You can’t have the economy of the future unless you have the money of the future,” said Disparte, highlighting the importance of embracing digital currencies.