InvestNot yet confirmed elsewhere1 publisher2 min readPublished
Bank of England urges UK firms to build sterling stablecoins while the digital pound waits
Bank of England sees no urgent need for a retail digital pound, a Deputy Governor said on 12 October 2026. It expects three dominant sterling stablecoins at about EUR 46 billion of demand each, so the field for new issuers is narrow.
The Investor · Invest desk
Two values for central bank money's share of transactions in the economy: about 66.7%, or two-thirds, earlier, and 8% after the fall, according to a Bank of England Deputy Governor.
| Measure | Value | As of | Claim |
|---|---|---|---|
| Earlier, about two-thirds | 66.7% share | 13 | |
| Share after the fall | 8% share | 5 |
What happened
- The official suggested bank-developed stablecoins and tokenised deposits could fill the role planned for a digital pound, and questioned whether central bank money needs to lead the shift.
- The official described a multi-money model in which cash, any CBDC, bank deposits, tokenised deposits and stablecoins, all in sterling, exchange at par.
- The bank is upgrading RTGS so its liabilities can settle sterling financial market transactions around the clock, instead of prioritising a retail CBDC.
- The official repeated that UK firms should develop sterling stablecoins, so that UK users do not reach new payment methods only through US dollar tokens.
Why it matters
- decision Teams budgeting for a digital pound integration have no date to plan against, since any retail decision is tied to how the alternatives develop; the funded work is tokenised deposit and sterling stablecoin acceptance.
- exposure Banks and issuers building these rails answer to a Bank of England regulator whose stated aims include preserving the singleness of money, so a token trading away from par with deposits falls outside the model described.
- constraint The forecast names a count of three, so a firm planning a fourth sterling issuer has to win its case by taking share from one of them.
The one figure a builder can size a plan against is the stablecoin estimate. The bank expects three dominant sterling stablecoins, with demand of approximately EUR 46 billion for each [15], or EUR 138 billion across the three [16]. Thepaypers.com gives the figure in euros for a sterling market, relays remarks that Bloomberg also reported [4], does not name the Deputy Governor, and does not say over what period the demand would arise.
The context for the pause is a number that could be read the other way. Central bank money has fallen from two-thirds of transactions in the economy to 8%, according to the official [5], a drop of about 58.7 percentage points [14] that leaves it at roughly an eighth of its earlier share [13]. Thepaypers.com puts the question this raises as whether the monetary system remains anchored when central bank money plays a smaller role [10]. In our view a retail CBDC would lift that share most directly, and the bank's answer so far is the RTGS upgrade [7].
The pause can end early. Bloomberg described the stance as wait-and-see [4], and the official said the call on a retail CBDC depends on whether the benefits of tokenisation and new payment methods can be achieved by other means [2]; if the private rails stall, that condition fails and the question reopens. US dollar tokens could also keep the UK market, an outcome the official called undesirable [8], and we'd expect the case for a retail CBDC to return with it. Or banks' tokenised deposits could carry most of the volume and leave stablecoin issuers with less than the EUR 138 billion [16] (that split is our conjecture).
Even so, we think build effort belongs on the private rails. Thepaypers.com concludes that the bank's position makes tokenised deposits and sterling stablecoins central to UK digital payments [11], and a firm that ships them also produces the evidence the bank will judge them by.
We would be wrong if the bank schedules design work on a retail CBDC before sterling issuers reach scale, or if the first sterling stablecoins draw far below EUR 46 billion each [15].
What to watch
- Whether the Bank of England sets criteria or a date for revisiting a retail CBDC, since the source ties the decision only to how the alternatives develop.
- Whether sterling stablecoins consolidate into three dominant issuers near EUR 46 billion of demand each, or US dollar tokens keep the UK market.
- When the upgraded RTGS starts settling sterling financial market transactions around the clock.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence40
- Adoption
- Insufficient
- Hype gap
- Insufficient
- Incentives55
- Confidence50
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
The Bank of England does not see an urgent need to introduce a retail central bank digital currency, according to remarks made by one of its Deputy Governors on 12 October 2026.
ReportedSupportedSource: thepaypers.com, reporting remarks by a BoE Deputy GovernorView cited source - [2]
The official said the decision on whether to proceed with a retail CBDC, known in the UK as Britcoin, would depend on whether the benefits of tokenisation and new payment methods could be achieved by other means.
- [3]
The official suggested that commercial stablecoins and tokenised deposits developed by banks could fulfil the role envisaged for a digital pound, and questioned whether central bank money needs to lead this shift.
- [4]
The comments indicate that the BoE has adopted a wait-and-see approach while other developments take place within the payments system, as reported by Bloomberg.
- [5]
According to the official, central bank money has fallen from two-thirds of transactions in the economy to 8%.
- [6]
The official described a multi-money model in which cash, a CBDC (if one is issued), commercial bank deposits, tokenised deposits and stablecoins, all denominated in sterling, can be exchanged seamlessly at par.
- [7]
Instead of prioritising a retail CBDC, the BoE is upgrading its Real Time Gross Settlement (RTGS) system so that its liabilities can serve as the settlement asset for sterling financial market transactions, aiming to capture 24/7 instantaneous settlement while keeping central bank money at the core.
- [8]
The official reiterated the BoE's position that UK firms should develop sterling stablecoins as an alternative to the dominance of US dollar-denominated tokens; the concern is that UK consumers and businesses could otherwise access new payment methods only through USD stablecoins, an outcome the official described as undesirable.
- [9]
The BoE is strengthening its role as a stablecoin regulator, with the stated objectives of preserving the 'singleness of money' and ensuring stablecoins are integrated into the payment system so households and businesses can use them widely as money.
- [10]
The fall in the share of central bank money raises the question of whether the UK monetary system remains anchored when central bank money plays a smaller role.
- [11]
For banks and prospective stablecoin issuers, the BoE's position indicates that tokenised deposits and sterling stablecoins are expected to play a central part in the UK's digital payments infrastructure.
- [12]
Any decision on a retail CBDC remains linked to how the alternatives, tokenised deposits and sterling stablecoins, develop.
- [13]
A central bank money share of 8%, against an earlier two-thirds (about 66.7%), is roughly 12% of its earlier share, or about an eighth.
- [14]
The fall from two-thirds (about 66.7%) to 8% is about 58.7 percentage points.
- [15]
The BoE expects three dominant sterling stablecoins to emerge, with demand of approximately EUR 46 billion for each.
- [16]
Three sterling stablecoins at about EUR 46 billion of demand each total about EUR 138 billion.
Sources
1 independent publisher whose own reporting we read for this story.
- thepaypers.comBank of England signals no rush to launch retail digital pound
1 article · October 13, 2026
Topics and entities
Follow any of these and your For You feed starts watching them — no settings page required.