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IN 20 SECONDS
One coin aims to be worth £1, and it moves on a blockchain rather than through a bank.
The issuer creates GBP stablecoins when it receives pounds and destroys them when it pays pounds out.
What keeps it at £1 is the backing and the right to redeem, not an algorithm.
It isn’t a bank deposit: the FSCS doesn’t cover it.
How a GBP stablecoin works
Every coin goes through the same lifecycle:
- 1Pounds inA customer sends pounds to the issuer by bank transfer.
- 2Coins mintedThe issuer creates (“mints”) the same number of coins and sends them to the customer’s address on a blockchain.
- 3Coins moveFrom there the coins can be sent to anyone with an address, sold on an exchange or used in an app, without the issuer being involved.
- 4Coins redeemed and burnedWhoever holds them can send coins back to the issuer, which destroys (“burns”) them.
- 5Pounds outThe issuer pays the same number of pounds to that customer’s bank account.
Only the issuer’s own customers can mint and redeem directly. For tGBP that means businesses with a BCP Technologies account that have passed its identity and anti-money-laundering checks; they mint by sending pounds from a UK bank account by Faster Payments or CHAPS. Everyone else buys and sells on an exchange, at whatever price the market sets. That price stays close to £1 because the customers who can redeem keep it there (more on that below).
Are GBP stablecoins held in a UK bank?
No. Stablecoins are issued on a blockchain. The issuer controls the stablecoin’s “smart contract”, a program on a blockchain such as Ethereum, and only it has the authority to mint new coins. The coins themselves are programmable, so they can be sent to other addresses: other people, or other smart contracts.
Everything that happens onchain is separate from the UK banking system. Transactions are checked by computers (“nodes”) all around the world, which agree on three things before a payment goes through:
- the sender owns the coins;
- the amount sent is no more than their balance;
- the sender has paid the network’s “gas” fee, typically pennies or less.
If the transaction is valid, it goes through, typically within seconds. That’s true at 3am on a Sunday as much as on a weekday afternoon, because there’s no bank in the middle.
What backs each coin
Stablecoins don’t exist in the physical world, but their backing does.
- Cash and short-term government debt. tGBP’s issuer, BCP Technologies, holds the backing in segregated accounts, kept apart from its own money, in assets such as money market funds, UK government debt and bank deposits.
- Monthly reports. Andersen reports on tGBP’s reserves every month. These are agreed checks on the balances, not a full audit.
- Not every coin works this way. GBPm is created by people who lock up Mento’s dollar coin, USDm, as collateral. USDm is in turn backed by a reserve of other stablecoins, including USDC and USDT. No pounds are held in a bank.
That changes on 25 October 2027. From then, FCA rules require every UK issuer to back each coin in full from the moment it’s created. The backing must be held on a statutory trust for holders, and redemptions paid by the end of the next business day.
How it stays at £1
The right to redeem puts a floor and a ceiling on the price. If tGBP trades at 99p on an exchange, a customer who can redeem buys it there and swaps it with the issuer for £1. If it trades at £1.01, they mint new coins for £1 and sell them. Either way, they profit by pushing the price back to £1.
tGBP price against £1, last 90 daysShaded band is ±0.5%. Source: our own reads. Open the coin page for the events marked here, 90 days and 1 year.
In the 90 days to 7 October 2026, tGBP’s daily price never closed more than 0.31% from £1, and on 75 of those days it closed within 0.1%.
Small, quiet markets wobble more. A coin with few traders can move a penny or two on a single large order, then settle back. That’s a sign of a thin market, not of the backing failing.
One coin, many networks
The same coin can exist on several blockchains. tGBP uses one address, 0x27f6…5287, on Ethereum, Base, Polygon, Arbitrum, BNB Chain and Avalanche, and different ones on Solana and Gnosis. Some coins have a different address on every chain.
The contract address is the coin’s identity. Anyone can create a token and call it “tGBP”, and several people have. The name proves nothing; the address does. Copy it from the issuer’s own site or the coin’s page here, and check it before you buy or receive.
What it is and what it isn’t
| Compared with | How a GBP stablecoin differs |
|---|---|
| Bank deposit | Covered by the FSCS up to £120,000 and can pay interest. A GBP stablecoin has no FSCS cover, and the issuer pays no interest. You can lend stablecoins through DeFi lending protocols, apps that run on a blockchain, for a lending rate, but that takes on the protocol’s risks as well as the coin’s. |
| E-money (Revolut or Wise balances) | Safeguarded under different rules and stays inside one firm. A stablecoin moves between wallets and apps, whoever runs them. |
| Digital pound | Would be issued by the Bank of England itself, and doesn’t exist yet. |
| Tokenised deposit | A bank’s own deposit recorded on a blockchain, with the usual protections. |
| Dollar stablecoins (USDC, USDT) | Same mechanics, different currency: their value in pounds moves with the exchange rate. → GBP vs dollar stablecoins |
The GBP stablecoins today
- tGBP, issued by BCP Technologies. The largest, and the only one on centralised exchanges (Coinbase and Kraken). Registered with the FCA.
- GBPA, issued by Agant Finance. Runs on Ethereum, Arc, Base, Tempo and Solana. Its issuer is registered with the FCA, and onboards businesses only.
- GBPm, issued by Mento. Runs on Celo and Monad, and backed by crypto collateral rather than pounds.
- VGBP, issued by VNX in Liechtenstein, under that country’s Blockchain Act. Runs on Solana, Celo, Base and other networks.
Registration with the FCA covers anti-money-laundering checks only. Authorisation under the new regime is a separate step: the FCA started taking applications on 30 September 2026, and the regime starts on 25 October 2027.
The contracts behind tGBP and VGBP let the issuer freeze an address; GBPm’s has no freeze function. tGBP’s terms say BCP Technologies may freeze coins if it receives a legal order from a government authority, or suspects illegal activity or a breach of its terms. Banks and payment firms work under the same duty.
Who uses them, and who they’re not for
GBP stablecoins suit:
- people sending pounds onchain, to another wallet or to an app;
- people paying with crypto, or settling trades in pounds rather than dollars;
- businesses moving money outside banking hours;
- people who want full control of their money without going through a bank.
They’re not for you if you want interest or growth. A GBP stablecoin aims to be worth £1 tomorrow and £1 next year. It’s for holding and moving pounds, not for growing them.
FAQs
Who issues GBP stablecoins?
Private companies, not the Bank of England. BCP Technologies issues tGBP, Agant Finance issues GBPA, Mento issues GBPm and VNX issues VGBP. From 25 October 2027, a company issuing a GBP stablecoin in the UK will need FCA authorisation.
Is a GBP stablecoin the same as the digital pound?
No. A GBP stablecoin is issued by a private company and exists today. The digital pound would be issued by the Bank of England, and no decision has been made on whether to introduce it.
Can I swap a GBP stablecoin back for pounds?
Yes, but usually not with the issuer. Most people sell on an exchange such as Kraken or Coinbase and withdraw pounds to their bank. Only the issuer’s own customers redeem with it directly.
Why would a GBP stablecoin trade below £1?
Usually because the market is thin: a large sell order on a quiet exchange moves the price until traders who can redeem buy it back up. A lasting drop would mean the market doubts the backing or the right to redeem.
Which blockchains are GBP stablecoins on?
tGBP is on Ethereum, Base, Polygon, Arbitrum, BNB Chain, Avalanche, Solana and Gnosis. GBPA is on Ethereum, Arc, Base, Tempo and Solana, GBPm on Celo and Monad, and VGBP on Solana, Celo, Base and other networks. Always check the contract address for the chain you’re using.
Is tGBP a GBP stablecoin?
Yes. tGBP is issued by BCP Technologies, backed by pounds and short-term government debt, and is the largest GBP stablecoin by supply.
SOURCES · CHECKED 8 OCT 2026
↗FCA: PS26/10 Stablecoin issuance, final rules (30 June 2026)
↗FCA: Cryptoasset regime policy statements and timeline
↗FCA: Using payment service providers (e-money and the FSCS)
↗BCP Technologies: tGBP terms v2.1
↗BCP Technologies: tGBP reserve reports (Andersen, monthly)
↗Bank of England (PRA): FSCS deposit limit rises to £120,000 from 1 December 2025
↗Bank of England: Digital pound design phase progress update (4 Mar 2026)
