The Bank of England scrapped its plan to limit how much stablecoin individuals and businesses can hold, a reversal that hands the crypto industry a clear regulatory win. In a policy statement published Monday, the central bank dropped its proposed £20,000 ($27,000) cap on personal balances and £10 million ceiling on corporate holdings for any single coin. In their place sits a macro-level guardrail that caps the total circulation of any one systemic stablecoin at £40 billion, roughly $50.6 billion. The shift moves the regulatory burden from everyday users onto issuers and clears a path toward regulated sterling stablecoins in 2027.
A systemic stablecoin is a digital token pegged to a national currency that has grown large enough for regulators to treat it as critical payment infrastructure.
Key takeaways
- The Bank of England dropped per-person stablecoin holding limits of £20,000 for individuals and £10 million for businesses.
- A single £40 billion ($50.6 billion) issuance cap now applies to the total circulation of any one systemic stablecoin.
- Issuers can hold up to 70% of reserves in short-term UK government debt, after the non-interest-bearing deposit requirement fell from 40% to 30%.
- Industry feedback runs until 22 September, with rules to be finalized by the end of 2026 and a market launch targeted for 2027.
Published: 23 June 2026, 09:00 UTC
What changed and why it matters
The original proposals would have stopped users from holding more than £20,000 of a single stablecoin and capped business holdings at £10 million per coin. Issuers and trade bodies called those limits overly conservative, arguing they would damage business viability and push activity offshore.
The central bank agreed after a consultation that closed earlier this month. “We acknowledge the issues raised and have reviewed the analysis supporting the calibration,” the bank said in its statement. The reversal also followed a June report from the cross-party Financial Services Regulation Committee in the House of Lords, which urged the Bank to reconsider caps that “could have a significant impact on the business viability of stablecoin issuers.”
Under the new framework, users and large companies face no restrictions on the amount, frequency or type of stablecoin transactions they can make. The £40 billion ceiling instead targets concentration risk, protecting the broader credit system from sudden capital flight while letting issuers scale.
The economics get friendlier for issuers
The Bank also reworked the reserve rules that govern how stablecoins are backed. It cut the share of reserves that must sit in non-interest-bearing central bank deposits from 40% to 30%, freeing issuers to put up to 70% into short-term UK government debt with maturities under six months.
That single change improves the math of running a pound-backed stablecoin, since gilt yield now covers a larger slice of reserves. The Bank kept its ban on paying interest or dividends to holders for simply parking a coin. It did carve out room for activity-based rewards such as cash-back tokens or loyalty points tied to payment transactions through Web3 apps, a structure that lets issuers compete on perks without offering yield.
What comes next
The £40 billion guardrail is explicitly temporary. The Bank said it intends to review the limit regularly and remove it once it is confident there is no threat to credit supply or financial stability. A final feedback window closes on 22 September, and officials aim to finalize the rules by the end of 2026.
If that timeline holds, regulated sterling stablecoins could begin operating in the UK in 2027, when the country’s broader crypto rules take effect. The move puts Britain in direct competition with the United States, where federal agencies recently pushed for bank-style customer ID rules on stablecoin issuers, and the European Union, where MiCA enforcement continues to reshape the market. For a fuller picture of the reversal, CoinDesk’s policy coverage tracks the consultation history.
Frequently asked questions
What did the Bank of England actually change?
It scrapped per-person stablecoin holding limits of £20,000 for individuals and £10 million for businesses. It replaced them with a £40 billion cap on the total circulation of any single systemic stablecoin, shifting the limit from holders to issuers.
Why did the central bank reverse course?
A public consultation and a House of Lords committee report warned that the original caps would hurt issuer viability and UK competitiveness. The Bank reviewed the feedback and agreed the limits were too restrictive for the market it wants to build.
When will regulated stablecoins launch in the UK?
A final feedback window closes on 22 September, and the Bank aims to finalize the rules by the end of 2026. Regulated sterling stablecoins could begin operating in 2027, when the UK’s wider crypto framework takes effect.
