The Bank of England Tests Interoperability Between Stablecoins and Digital Pound in Cross-Border Trade

The Bank of England is already preparing the coexistence between stablecoins and the digital pound. Its Digital Pound Lab is testing a cross-border payment where an exporter receives an advance in stablecoin before a British importer settles the transaction with simulated digital pounds. However, London has still not decided to launch its CBDC.

Stablecoins Enter the Digital Pound Lab

The test is conducted with NOBO Finance, Dun & Bradstreet, and Polygon Labs. It comes as the Bank of England is already working on a new framework for stablecoins in British pounds.

The chosen scenario involves a company selling goods abroad. The exporter first receives an advance via a system using a stablecoin. The buyer located in the UK then makes the payment with a simulated digital pound.

No real clients or real digital pounds yet, however. The Digital Pound Lab operates as a testing environment. The Bank of England also specifies that the experiments carried out there do not predict its future decisions.

The British digital pound therefore remains hypothetical.

This does not prevent the BoE from testing its uses. And especially its connections with other payment means. A possible British CBDC will indeed need to be able to circulate alongside bank deposits, existing payment systems, and probably stablecoins. The current experiment gives an initial idea of this mixture.

Cross-Border Trade Particularly Interests London

The choice of international trade is no coincidence. SMEs that export can often wait several days before receiving their money after shipping the goods. This delay ties up their cash flow and sometimes complicates access to financing.

NOBO Finance aims to reduce this lag thanks to stablecoins. Dun & Bradstreet provides data concerning companies and commercial risk. Polygon supplies the smart contract infrastructure.

A second project is also planned. It consists of creating reusable credit profiles for small businesses by combining transaction data, open finance information, and Dun & Bradstreet’s commercial data.

Payment and credit are thus found in the same project.

Stablecoins have already begun to gain ground in international transfers. MoneyGram has, for example, just extended its infrastructure to Solana allowing to convert cash and stablecoins. Its service covers withdrawals in more than 170 countries.

The Bank of England is therefore entering a field where the private sector is already advancing. For it, the question is less about whether multiple digital currencies will coexist than how they will be able to communicate with each other.

Cross-border trade is a good place to try.

London is Also Preparing Its Rules on Stablecoins

The Bank of England is not only working on the digital pound. In June, it published new proposals concerning systemic stablecoins denominated in British pounds. Issuers could place up to 70% of their reserves in remunerated British public debt.

A temporary cap of 40 billion pounds per systemic stablecoin is also considered. The previous limits planned for holdings by individuals and businesses have been abandoned. The final regulation must be completed before the end of 2026 for implementation planned in 2027.

Modernization also affects traditional banking infrastructures. The BoE wants to bring its RTGS and CHAPS systems closer to an almost permanent operation, including weekends. International payments and tokenization are among the reasons stated.

Stablecoins are therefore no longer treated as a crypto curiosity in London. They are gradually entering discussions on the very architecture of British payments.

The movement even goes beyond the UK. The use of these assets is progressing in transfers, crypto cards, and everyday payments. Stablecoins recently represented 84% of spending observed on certain crypto cards. The digital pound remains. The Bank of England continues its trials without promising it will ever see the light of day. Stablecoins, however, no longer need to wait for this decision.