Lion Is in the Room: Stablecoins Have Arrived

The stablecoin lion is already in the room.

The question is not whether it should be there. The question is whether we are prepared to train it.

Stablecoins — and related instruments such as tokenised deposits — offer compelling advantages: lower transaction costs, greater transparency, improved accountability, and genuine 24/7 accessibility. These are not marginal improvements. They represent structural change in how value moves.

For the UK, this matters enormously.

The City of London remains the world’s largest foreign exchange centre. It holds that position partly because of geography: London bridges Asia and the United States. As Asia closes, London opens. As London closes, the US begins. This unique time-zone advantage has underpinned decades of global trading dominance.

But technology has changed the rhythm. Markets no longer need to sleep. Digital assets can trade 24/7. Tokens can be transferred and stored in digital wallets anywhere in the world at any time. The competitive edge now lies not only in geography, but in infrastructure.

The Bank of England has already taken meaningful steps. Following its consultation — to which the WCIT (Worshipful Company of Information Technologists) responded broadly in agreement, offering six practical recommendations — the Bank announced plans to extend CHAPS and RTGS operating hours, targeting 2027. This is a significant move. Stablecoins require round-the-clock access and finality of settlement; the UK is aligning its core systems accordingly.

In addition, four organisations have been admitted to the Bank’s regulatory sandbox to trial stablecoin models — an encouraging sign that experimentation is being paired with oversight.

Naturally, concerns remain.

A central issue is interoperability. Much of the financial system still relies on centralised, hierarchical core systems, often written in legacy languages such as COBOL and even Assembler. These systems — some representing 50% of banks’ core infrastructure — are deeply embedded and mission-critical. They are the bedrock of financial services.

Yet the divide between legacy infrastructure and permissionless distributed ledgers is narrowing. APIs, advances in distributed ledger technology, smart contracts, and improved processing speeds are making integration far more achievable than even a few years ago.

Governance is evolving too. Stablecoin ecosystems increasingly rely on near real-time data flows, transparent ledgers, and clearly defined custodial arrangements. Combined with established KYC and AML frameworks — and enhanced by continuous transaction monitoring — these structures can mitigate financial crime risks more effectively than many legacy systems. Instant settlement does not mean reduced compliance; in fact, it can mean greater traceability.

Globally, adoption is accelerating. The jurisdiction that ultimately “owns” digital finance will not be the one that moves fastest without guardrails, but the one that demonstrates interoperability, legal clarity, regulatory confidence, and international trust.

Here, the UK has formidable advantages.

Five centuries of commercial continuity have given the City of London globally respected standards in law, governance, regulation, liquidity and market fairness. Few jurisdictions can match that institutional inheritance. The UK is not merely participating in digital finance; it is well positioned to shape its rules.

But success depends on perception as much as plumbing.

Stablecoins must look and feel like money. They must be simple to use and intuitively understood. Consumers do not want a lecture on distributed ledger architecture; they want to pay for dinner.

Apple Pay succeeded not because people mastered its technology, but because it made payment easier than pulling out a card. Ask in a pub quiz who has a digital wallet and many will say “not me” — until someone points out it’s already on their phone.

The same principle applies to stablecoins. Education is essential — not technical evangelism, but practical clarity. What are stablecoins? Who issues them? Who safeguards them? How are they governed? How are disputes resolved? How is value protected?

Confidence comes from understanding.

The UK’s geographic position, legal depth, and institutional credibility provide a genuine competitive advantage in digital finance governance — but only if matched with deliberate action. The Bank of England’s 2026 consultation milestones must be met. Infrastructure must be modernised. Standards must be set. And education must accompany innovation.

Because this is no longer an abstract debate.

You can ignore an elephant in the room for a remarkably long time. It is large, yes — but often immobile.

A lion is different.

A lion demands attention. It reshapes the behaviour of everyone around it. It cannot be wished away, postponed, or politely avoided.

Stablecoins are not a theoretical presence. They are active, mobile, and global.

The lion is already in the room. The real question is whether the UK intends to lead the training — or watch from the doorway while others do.