US and UK Treasuries Move to Align Oversight of Stablecoins and Tokenized Finance

The US Department of the Treasury and the UK's HM Treasury issued joint recommendations through a transatlantic working group aimed at coordinating supervision of digital-asset markets, with a focus on stablecoins and tokenized finance. In a statement released Tuesday, the agencies said they want regulatory expectations to converge in ways that support financial stability while avoiding unnecessary distortions to market competition. The recommendations were published under the Transatlantic Taskforce for the Markets of the Future, a bilateral initiative designed to deepen cooperation across financial markets. The two governments said they intend to tailor rules to each jurisdiction while seeking comparable outcomes for comparable risks and activities. Stablecoins: alignment, cross-border competition, and full backing The statement calls for the US and UK to align around stablecoin rules without undermining cross-border competition. It also sets a clear baseline for reserve quality, stating that stablecoins should be fully backed, at least on a one-to-one basis, by high-quality, liquid assets. While the statement does not name specific US legislation, the approach mirrors the "fully backed" standard central to the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. GENIUS was signed into law last year and is awaiting implementing regulations ahead of its effective date in January 2027. Tokenized assets: cross-border testing and shared supervisory approaches Beyond stablecoins, the task force recommended exploring a private-sector-led group to test cross-border use cases for tokenized assets. The statement frames real-world testing as a practical way to surface where supervisory expectations diverge and where common standards could emerge as tokenization is applied across different asset classes and settlement models. On regulatory coordination, the statement also points to closer work between US financial agencies and the Bank of England to identify shared approaches to regulating tokenized assets. While no detailed rule text was provided, the message signals interest in convergence on supervision and risk management. UK outlook: tokenization tied to economic gains by 2035 The transatlantic recommendations follow renewed focus in the UK on tokenization's economic potential. A UK government-backed industry task force report has estimated that the UK could add up to $44 billion to annual economic output by 2035 if the country becomes a leading jurisdiction for tokenization, global adoption scales, and domestic uptake grows in step with major peers. That report also urged the UK to issue tokenized bonds by the first quarter of 2027 and proposed testing financial transactions on blockchain infrastructure—steps that would increase pressure for consistent frameworks covering tokenized securities, settlement, and related market plumbing. What to watch For investors and builders, the recommendations serve as a directional signal: the US and UK are aiming to converge on stablecoin reserve standards and to collaborate on tokenized-asset testing and regulatory coherence. Key near-term questions include how quickly alignment becomes actionable guidance, particularly as the US stablecoin regime awaits GENIUS implementing rules. As UK initiatives move toward tokenized bond issuance and blockchain transaction testing ahead of 2027, market participants will be watching whether cross-border pilots translate into concrete standards and whether "comparable outcomes" in supervision become more explicit in practice.