The emerging business case and BoE latest on Stablecoins

Stablecoins are crypto with a reserve of assets, one -to-one in value associated with the coins outstanding. Assets are of high-quality liquid value e.g. short-term US T-bills or commodities, such as gold.

In September 2025 The Bank of England (BoE) reflected on its new wholesale Real Time Gross Settlement System (RT2) which includes ‘multi-money’.  Multi-money is tokenised money which could take three forms: a central bank issued digital currency; a tokenised commercial bank deposit; or a stablecoin. BoE is currently looking at reappraising the regulation framework for stablecoins and should, after consultation, be ready in 2026.

A key BoE objective is to keep the value of the currency at “par with each other”. Wyoming’s Frontier shares the same goal by ensuring the payment transaction fees from US dollar to US stable coins and vice versa are as low as possible – a few cents.  The move to another currency from the US dollar is open to market competition. The UK leads the world in FX trading.

Since the passage of the Genius Act in the US at the end of July, Wyoming Stablecoin, Frontier, is planned for launch in September. Wyoming is known as the honest state by a major bank. A software update to the Credit Card Billing function erred by leaving the state’s records off the system. The switchboard was inundated with requests for credit card balances. This brought the mistake to light and was fixed. 

Now Wyoming offers the first American State Stablecoin.

New Regulation for Stablecoin

Wyoming has taken the regulatory initiative, and its thoroughness has established its stablecoin: Frontier. 

Meanwhile, The Hong Kong Monetary Authority implemented Stablecoin regulations in August 2025. This contains a well thought out Know Your Customer (KYC) and Anti Money Laundering (AML) sections. 

Both these are great guides to establishing stablecoin rules and regulations.

Infrastructure 

Frontier is divided into three distinct operational parts. The commission, the regulator of the process, the Licensed Service Providers (LSP) the Customers (Buyers)

1. Commission: Wyoming Stable Token Commission – which are mandated to buys 102% of LSP reserves supported by high-quality liquid debt, i.e. US T-Bills. 

1. 1. Current annual interest 6.1% on reserve covering stablecoin
   2. Funds increased if coins issued exceed 102% of LSP reserves
   3. Interest from T-Bills and expenses to help fund public schools in Wyoming

2. Licensed Service Providers (LSP) – Operations, sends and redeems FRNT stablecoin:
   1.  All buyers must pass KYK for compliance and digital verification
   2. Corporate Treasurers allow 2% discount on faster payment to suppliers and:
      1. could use this discount to offset the T-Bill interest rate
      2. could absorb the interest rate charge based on customer loyalty
   3. Frontier payment transactions fees are expected to be low a few cents or less.

3.   Customers (Buyers)– 
   1. Receive Compatible Digital Wallet to allow owner to sell/buy/swap/redeem FRNT for any fiat/crypto assets - Exchange/settlement fees from 1-5% 
   2. FRNT available for purchases off mobile telephone payment apps
   3. Digital payments made by/through digital wallet

More to come for the Stablecoin holder

Given the freedom offered to the digital stablecoin Defi (decentralized financial activities) become available.  One such wallet incentive is rewards on usage which can be compared to those like bank accounts. The big augment is this incentive really an interest yield.? Saying does ‘if it walks, talks and looks like a duck then it is…” 

Conclusion

The US has taken the lead in Stablecoins. 

The UK has a great opportunity for growing the digital economy, which worldwide is measured in the trillions. The UK has unique advantages in BoE, The City of London and its Legal Regime. The UK’s sense of fair play is renowned worldwide and the UK can be an active participant in this new ‘multi-money’ world.