TLDR:

• UK Treasury says digital assets could transform financial markets by accelerating capital flows and improving efficiency across systems.
• Economic Secretary Lucy Rigby notes faster settlement could free up capital and change how businesses manage liquidity.
• Authorities plan a consultation covering stablecoins, tokenized deposits, and AI-driven payment systems under one framework.
• U.K. regulators aim to align with the U.S. to reduce friction and support smoother cross-border digital asset operations.

UK Treasury digital assets policy is advancing as senior officials outline a shift toward tokenized payments and modernized financial regulation.

Economic Secretary to the Treasury Lucy Rigby said digital assets may reshape financial markets through faster capital movement and improved efficiency.

She made the remarks at the Financial Times Digital Assets Summit, where discussions also focused on stablecoins, regulatory coordination, and upcoming consultations covering digital payments and emerging financial technologies.

Treasury Frames Efficiency Gains From Digital Assets

UK Treasury digital assets developments were described by Lucy Rigby as central to future financial market changes.

She stated that digital assets offer “efficiencies generally, but also just everything happening much more speedily,” reflecting expectations for faster financial processes.

Rigby further explained that these systems could change how capital moves across the economy. She said it is important to consider “what that actually means for business,” including quicker capital flows and improved capital allocation.

She added that faster movement of funds may allow capital to be “freed up for other things,” pointing to broader adjustments in financial operations. These remarks were delivered during discussions at the Financial Times Digital Assets Summit.

Rigby also said digital assets have “the potential for complete transformation of our markets,” noting that the effect extends beyond efficiency improvements. She emphasized that regulators must assess how these systems interact with existing market structures.

The Treasury official said authorities will work closely with industry and regulators to understand these changes. She also linked this approach to broader financial reforms aimed at modernizing oversight frameworks.

Stablecoin Regulation and Cross-Border Alignment Discussions

UK Treasury digital assets policy also includes upcoming stablecoin regulation involving the Financial Conduct Authority and the Bank of England. Rigby noted that authorization processes for issuers are expected to open later this year.

She referenced ongoing regulatory development, saying there is a need to ensure “administrative burden on firms is proportionate” as the financial system evolves.

The government is also preparing a consultation on payment systems that include both traditional and tokenized models.

The consultation will also cover stablecoins and AI-driven payment technologies under a unified framework. Rigby said this approach is designed to streamline regulation across the payments sector.

She also pointed to the importance of international coordination, stating the need to “minimize frictions” between the U.K. and U.S. regulatory regimes. She added that alignment may involve recognition mechanisms between jurisdictions.

Rigby said digital assets are set to become a permanent feature of the U.K. financial landscape. She stated that policymakers must support innovation while ensuring regulation develops alongside market changes.

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