Firms must meet governance, financial crime, and Consumer Duty rules for authorisation.
The Financial Conduct Authority has chosen four companies to trial stablecoin services under proposed regulations. The initiative is part of the FCA’s Regulatory Sandbox, which allows firms to test products in real-world conditions with safeguards.
The sandbox follows the FCA’s broader work on crypto regulation. Last month, it opened a consultation on final rules for cryptoasset firms, with responses accepted until 12 March 2026.
The FCA received 20 applications and selected Monee Financial Technologies, ReStabilise, Revolut, and VVTX. Testing will focus on stablecoin issuance. The proposals cover different use cases, including payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term, wholesale settlement, and crypto trading.
Matthew Long, director of payments and digital assets at the FCA, said the regulator is “supporting UK stablecoin issuers to ensure they can be trusted for payments, settlement and trading,” adding that the work will “benefit consumers and financial transactions” and contribute to the FCA’s strategy and the Government’s National Payments Vision.
Firms in the sandbox will receive feedback from FCA specialists. The findings will inform the UK’s stablecoin Stablecoin Unlike other cryptocurrencies like Bitcoin and Ethereum, stablecoins are cryptocurrencies that have been designed to keep a stable value. Placing a greater emphasis on stability over volatility can be a huge draw for some investors. Many individuals can be turned off from large swings and uncertainty presented by cryptos relative to other traditional assets.Stablecoins control for this volatility by being pegged to another cryptocurrency, fiat money, or to exchange-traded commodities, including Unlike other cryptocurrencies like Bitcoin and Ethereum, stablecoins are cryptocurrencies that have been designed to keep a stable value. Placing a greater emphasis on stability over volatility can be a huge draw for some investors. Many individuals can be turned off from large swings and uncertainty presented by cryptos relative to other traditional assets.Stablecoins control for this volatility by being pegged to another cryptocurrency, fiat money, or to exchange-traded commodities, including Read this Term rules, expected to be finalised later in 2026. Testing is scheduled to begin in the first quarter of 2026.
The FCA described the sandbox as part of a broader effort to enable innovation in UK financial services. It complements initiatives such as the Digital Securities Sandbox.
Sandbox Firms Must Obtain Full Authorisation
All firms in the sandbox will need to be authorised under the new crypto regime once it launches in October 2027. The application gateway opens in September 2026.
The FCA has previously consulted on multiple aspects of crypto regulation, including stablecoin issuance, cryptoasset custody, prudential rules, conduct of business, and market abuse. The consultations are now largely complete, and policy statements are expected this summer.
