The Bank of England relaxes rules but limits systemic stablecoin issuance to 40 billion pounds to curb deposit outflows from banks.
The Bank of England introduced a 40 billion-pound cap on systemic stablecoin issuance, easing earlier restrictions while aiming to prevent large-scale deposit shifts from banks. The move targets payments-focused tokens used by households and businesses, excluding crypto trading stablecoins under FCA oversight.
Previously, the BoE proposed stricter holding limits and reserve requirements, but feedback from digital asset firms warned of reduced competitiveness against dollar-backed stablecoins. The revised regime seeks to balance adoption with financial stability, addressing concerns over credit availability for businesses and consumers.
Deputy Governor Sarah Breeden noted the adjustments follow industry pushback, emphasizing the need to maintain the UK’s competitive edge in digital assets without compromising systemic risk controls.