Bank of England Tests Stablecoins and Digital Pound in Cross-Border Finance

The Bank of England and HM Treasury are still assessing whether to issue a digital pound, with no launch decision taken. The Digital Pound Lab, scheduled from August 2025 through July 2026, provides a simulated environment for testing payment services rather than conducting transactions with real money or customers. Interoperability is central to the project as policymakers examine how central bank money, commercial bank deposits and regulated stablecoins could coexist without fragmenting the monetary system.

A report on Aug. 12 said Phase 2 work involving NOBO Finance, Dun & Bradstreet and Polygon Labs would test two trade-finance applications. One combines electronic bills of lading and invoice factoring, advancing funds to an exporter through stablecoin rails before a UK importer settles in digital pounds. The second, called SME Bankable Profile, combines Dun & Bradstreet identity and risk data with Polygon smart contracts. No trial value was disclosed; Polygon said its infrastructure has processed trillions in stablecoin volume.