HM Treasury on September 15 laid final legislation in Parliament to amend the UK’s cryptoasset regulations, proposing a narrow exemption for certain stablecoin payment activity before the wider regime takes effect in October 2027. The measure would remove several crypto dealing permissions for transfers and exchanges of qualifying stablecoins issued by authorised UK firms, while leaving custody-like safeguarding and lending activity regulated.

HM Treasury’s proposed stablecoin payments exemption

According to HM Treasury’s policy note, the draft statutory instrument would exempt transfers and exchanges involving qualifying stablecoins from dealing in cryptoassets as principal, dealing as agent and arranging.

The exemption is confined to qualifying stablecoins issued by authorised UK firms, not stablecoin-related business generally or tokens outside the specified category.

Interim bridge to the October 2027 regime

HM Treasury’s September 15 publication confirmed that it had laid the legislation in Parliament on the draft statutory instrument.

The proposed exemption covers specified payment-related transactions involving qualifying stablecoins issued by authorised UK firms. Particular transfers or exchanges may fall within the dealing and arranging carve-out, while lending and borrowing involving those stablecoins would remain within the cryptoasset regulatory perimeter.

HM Treasury describes the measure as an interim step ahead of broader reforms to payments services. Its stated purpose is to avoid requiring stablecoin payment firms to obtain cryptoasset dealing and arranging authorisations before the new framework begins in October 2027.

The measure does not replace the planned broader cryptoasset framework or create a general exclusion for stablecoin-related business or tokens issued outside the specified category.

Safeguarding, lending and borrowing remain in scope

Firms holding qualifying stablecoins for customers would generally still need safeguarding permissions.

Lending and borrowing involving those stablecoins would remain within the cryptoasset regulatory perimeter, while particular transfers or exchanges may fall within the dealing and arranging carve-out.

The draft therefore narrows permission relief to specified payments activity by authorised UK issuers. It does not exempt the broader services that can accompany stablecoin use.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.