Bank of England caps UK stablecoin issuance at £40 billion

The Bank of England has withdrawn its proposed £20,000 per‑person and £10 million per‑business holding limits for sterling stablecoins. Instead, a June 22 policy statement sets a single £40 billion cap on the total issuance of each systemic stablecoin and loosens reserve requirements, allowing issuers to hold up to 70 % of backing assets in short‑term UK government debt while reducing unremunerated deposits to 30 %.

The move aims to make the UK a more flexible environment for crypto firms as the EU’s MiCA regime comes into full effect in July 2026. Sterling tokens represent roughly 0.5 % of a $315 billion global stablecoin market. Regulators cite concerns about deposit flight and financial‑stability risks while seeking to preserve the commercial viability of stablecoins for payments and settlement.