The Bank of England told lenders on Monday that they must avoid any risk that customers might confuse new forms of e-money, including 'stablecoins', with standard deposits which are guaranteed against bank failures.

"If deposit-takers or their groups want to issue e-money or regulated stablecoins to retail customers, then this should be done from separate non-deposit-taking and insolvency-remote entities," the BoE said in a letter to banks.

The BoE and Britain's Financial Conduct Authority also published preliminary proposals for regulating stablecoins, seeking feedback by Feb. 6. (Reporting by David Milliken, Editing by Kylie MacLellan)