The UK relaxes stablecoin limits!
Eliminates individual holding cap, replaces it with a £40 billion safeguard.

The Bank of England announced a draft stablecoin regulatory framework on June 22. The authorities removed the previously proposed holding limits for individuals and businesses, replacing them with a transitional safeguard of a total issuance cap of £40 billion, while also loosening the reserve asset requirements for issuers.

On Monday, June 22, the Bank of England (BoE) released a draft “Systemic Stablecoin Regulatory Policy Statement and Code of Conduct,” abandoning the stablecoin holding limits of £20,000 (about $27,000) for individuals and £10 million for businesses that were proposed during last year’s consultation. Instead, it adopted a “single systemic stablecoin issuance cap of £40 billion (about $50.6 billion)” as a transitional regulatory tool. BoE Deputy Governor Sarah Breeden described this framework as a “world-leading regulatory regime,” and said the BoE and the UK Financial Conduct Authority (FCA) will jointly connect the transition from non-systemic to systemic stablecoins.

Holding limits removed; overall issuance capped at £40 billion as a “transitional safeguard”

In its official statement, the BoE said the original proposal’s holding limits for individuals and businesses “would affect issuers’ business models and international competitiveness,” and after incorporating consultation feedback, it decided to scrap the limits. A total issuance control of £40 billion (about $50.6 billion) per systemic stablecoin will instead be implemented as a “transitional safeguard.” The BoE said: “We acknowledge the issues raised and have re-examined the data on which the calibration analysis was based.” This safeguard will be reviewed periodically and phased out once credit supply risks have been addressed.

Reserve asset requirements relaxed: 30% central bank deposits + 70% T-bills

In addition to removing the holding limits, the BoE also reduced the reserve asset requirements: issuers need only hold 30% of reserves in non-interest-bearing deposits at the central bank, with the remaining up to 70% allocated to UK Treasury bills (T-bills) with remaining maturities of less than 6 months. Although issuers may earn yields from T-bills, the BoE strictly prohibits issuers from paying interest or dividends directly to holders; activity-based rewards (such as consumer cashback reward tokens or loyalty points within Web3 applications) are explicitly permitted. Chain News’s 2026 Stablecoin Complete Guide has compiled the reserve structures and regulatory frameworks of major stablecoins worldwide.

Tri-part push: consultation feedback, House of Lords committee collaboration, and FCA coordination

This major policy shift relates to a report earlier this month from the UK House of Lords Financial Services Regulatory Committee, in which cross-party members urged the BoE to re-examine holding limits that could “seriously impact the commercial viability of stablecoin issuers.” Chain News previously reported that in May, BoE Executive Director Sasha Mills publicly characterized stablecoins as “a new form of money,” and that there is no longer an either-or choice between tokenized deposits; this time, it is being more concretely implemented as regulatory text. The consultation period for opinions on the new framework will close on September 22. The BoE plans to complete the final version of the code of conduct by the end of 2026, and regulated stablecoins are expected to be officially operational in the UK in 2027.

• This article is reprinted with permission from: 《Chain News》
• Original title: 《Bank of England Abandons Stablecoin Holding Limits, Sets £40 Billion Issuance Cap》
• Original author: Elponcrab