In a Financial Times op-ed, Osborne explained that the UK risks losing its status as a financial leader while the US advances through initiatives like the GENIUS Act. Osborne criticized Chancellor Rachel Reeves and supported Coinbase’s controversial ad campaign, which mocked the UK’s economic stagnation and pointed to crypto as an alternative. Meanwhile, the GENIUS Act itself is under scrutiny in the US for banning yield-bearing stablecoins. Critics say this favors traditional banks and undermines stablecoin innovation. Other experts argue that tokenized money market funds may benefit, but stablecoins still hold an edge in DeFi.
UK Missing Crypto Opportunity
George Osborne, the former UK chancellor and now adviser to Coinbase, issued a stark warning that the United Kingdom is falling behind in the digital asset race, particularly in the stablecoin sector. In a recent Financial Times op-ed, Osborne voiced his concerns over the UK’s sluggish progress in adopting crypto-friendly policies, and argued that the country is at risk of squandering its position as a global financial leader.
George Osborne
He criticized the government’s inaction, especially with regards to stablecoins, which he sees as essential tools for reducing friction in global finance. Osborne stated that while the US is forging ahead with initiatives like the GENIUS Act to cement the dollar’s dominance in the stablecoin space, the UK risks irrelevance. He warned that the British pound — one of the world’s most traded currencies — may not even play a supporting role in the digital economy if current trends continue.
Osborne’s critique was aimed in part at current Chancellor Rachel Reeves, whom he accused of failing to deliver on promises to support innovation in the digital currency sector. His comments were made after a controversial ad campaign by Coinbase titled “Everything Is Fine,” a satirical musical piece that mocks the UK’s economic stagnation and cost-of-living crisis.
According to Coinbase CEO Brian Armstrong, the ad was banned by UK television networks. It suggests that the traditional financial system is broken and points to crypto as a modern alternative. While the ad’s ban could not be independently verified by CNBC, it has nevertheless led to some debate and drew attention to Coinbase’s growing lobbying efforts in the UK.
Coinbase entered the UK market in 2015, and has been an aggressive force in shaping crypto regulation. This is particularly true in the US where it spent more on lobbying than any other crypto firm, according to Politico and OpenSecrets. Osborne’s op-ed and the company's latest campaign indicate that there is now a renewed push to influence policy in Britain.
Critics Question GENIUS Act Motives
While the US is making more progress with its GENIUS Act, it might not necessarily be in the right direction. The passage of the US GENIUS Act has been widely hailed as a major milestone for stablecoin adoption, but a controversial provision in the bill is drawing a lot of criticism for potentially limiting the appeal of digital dollars.
The legislation bans stablecoin issuers from offering yield-bearing versions of their tokens. This move effectively prevents both retail and institutional holders from earning interest on digital dollar holdings. Critics argue that this plays into the hands of the traditional banking sector, which has long relied on controlling yield opportunities for depositors.
Trump signs GENIUS Act (Source: Fox News)
Temujin Louie, CEO of crosschain protocol Wanchain, warned that the GENIUS Act may not be the unqualified win it seems to be. He pointed out that by prohibiting yield, the bill gives a competitive edge to tokenized money market funds, which are very quickly turning into Wall Street’s answer to stablecoins. JPMorgan strategist Teresa Ho explained the potential of tokenized MMFs to serve as margin collateral and fulfill other use cases that were traditionally served by stablecoins. Louie agrees with this, and said that tokenization grants MMFs the speed and flexibility previously unique to stablecoins, while also preserving regulatory oversight.
Paul Brody, global blockchain leader at EY, pointed out that tokenized MMFs and deposits could thrive in this new environment, since they can provide yield while functioning similarly to stablecoins. However, Brody added that stablecoins still maintain an edge in DeFi integration, thanks to their bearer asset nature, which allows easy use across decentralized platforms. If tokenized MMFs come with too many restrictions, their yield advantage might not be enough to win over users.
The banking industry’s influence over the legislation has been a strong point of concern for many. Reports from earlier this year revealed that financial institutions were actively lobbying to block yield-bearing stablecoins, as they see them as a threat to their business model.
NYU professor Austin Campbell shared that banks, having offered minimal interest for decades, fear losing ground if stablecoin issuers can provide yield directly to consumers. Despite the restrictions in the GENIUS Act, yield-bearing digital assets are not entirely absent from the US market. In February, the SEC approved the first yield-bearing stablecoin security, YLDS, issued by Figure Markets. It launched with a 3.85% yield. This means that there is a lot of potential for yield in tokenized assets, albeit under stricter securities regulations.
