Bank of England eases stablecoin rules, introduces 40B pound issuance cap
The Bank of England published draft rules for systemic stablecoins, easing reserve requirements and replacing holding limits with a temporary 40 billion pound issuance cap.
The Bank of England has published draft regulatory rules for systemic stablecoins, introducing a temporary issuance cap of 40 billion pounds as part of a broader framework designed to govern large-scale stablecoin operations in the United Kingdom. The draft rules also ease previously proposed reserve requirements, replacing earlier holding limits with the new cap as regulators work toward a clearer path for stablecoin adoption.
The move comes as the UK accelerates efforts to establish itself as a competitive hub for digital asset innovation. Regulators have been working on stablecoin oversight frameworks for several years, with the Financial Conduct Authority and the Bank of England each taking distinct but complementary roles in shaping the rules. The latest draft signals a shift toward more accommodative policy, reflecting ongoing dialogue between regulators and the financial industry.
The revised framework is expected to open doors for both domestic and international stablecoin issuers seeking to operate within the UK's regulated financial system. By softening reserve requirements and setting a defined issuance ceiling, the Bank of England appears to be balancing financial stability concerns with the need to remain competitive against other jurisdictions advancing their own digital asset regulations.
The draft rules are subject to a consultation period, with a formal launch of the regime currently targeting 2027. Market participants and stablecoin issuers will be closely monitoring the consultation process for any further adjustments to the proposed framework.
Source: Cointelegraph
