New regulatory powers Digital settlement assets Financial Services (Banking Reform) Act 2013
The Act expands the application of FSBRA 2013 so that its regulatory regime includes those systems using digital settlement assets in a similar manner to current payment system designation orders under section 43(1) of FSBRA 2013. Once a payment system has been designated as a regulated system by HM Treasury, the PSR will have regulatory powers over participants in that system to ensure that relevant stablecoin-based payment systems are subject to appropriate economic and competition regulation.
	Thereafter the PSR will have powers over digital settlement assets to issue directions (under section 54 of FSBRA 2013), system rules (under section 55), conduct investigations into regulatory failures (sections 83-93) and have enforcement powers to maintain competition scrutiny. As in the application of offences and sanction under the Banking Act 2009, the same would be the case for the application of FSBRA 2013 criminal offences to digital settlement asset payment systems. For example, under regulation 83 of FSBRA 2013, the Payment Systems Regulator may appoint an "officer" to conduct investigations on a regulated payment in furtherance of its payment systems objectives. In connection with that investigation, digital settlement assets will risk committing criminal offences under the Act and they will be liable to a term of imprisonment, or fine, or both.