ClearToken, a company focused on digital asset clearing and settlement, has received approval from UK regulators to launch a system for settling transactions involving cryptocurrencies and stablecoins. This development signifies the United Kingdom's ongoing commitment to expanding its regulatory oversight of the digital finance sector.
The company announced on Tuesday that it has obtained authorization from the Financial Conduct Authority (FCA) to operate its Delivery versus Payment (DvP) settlement platform, named CT Settle. This platform is designed to support spot trades across crypto assets, stablecoins, and fiat currencies.
Upon the operational launch of CT Settle, regulated financial institutions will gain access to a digital asset settlement system that adheres to the same regulatory and operational standards as traditional financial infrastructure.
ClearToken has stated that CT Settle is engineered to address the concerns that have made institutions hesitant to adopt digital assets, specifically concerning market efficiency, liquidity, and counterparty risk.
Niki Beattie, the chair of ClearToken, commented that the authorization is expected to act as a "catalyst for digital assets to be adopted at scale."
Broader Industry Shifts in the UK
The FCA's decision to authorize ClearToken aligns with a broader regulatory trend in the United Kingdom aimed at integrating digital assets into the established financial system.
Earlier this week, the Bank of England initiated a consultation period regarding stablecoins, seeking feedback on proposed regulations that could be implemented as early as next year. Governor Andrew Bailey has recently adopted a more flexible perspective on the potential risks stablecoins pose to financial stability, indicating a more pragmatic regulatory approach.
These actions are occurring in the context of concerns that the UK may be lagging behind other nations in stablecoin adoption, particularly the United States, following the passage of the GENIUS Act.
In April, HM Treasury released a draft policy paper detailing the future financial services regulatory framework for crypto assets. This framework aims to provide formal definitions for specific types of digital assets and bring key activities, such as issuance, custody, and trading, under the purview of the UK's regulated financial perimeter.
Concurrently, the UK government has also opened the market to retail investors for crypto exchange-traded notes (ETNs), signaling a national effort to incorporate digital assets into mainstream financial markets.