Bank of England Sets £40bn Issuance Cap in New Stablecoin Rules

The Bank of England published a policy statement outlining a draft framework for stablecoins in the United Kingdom. The revised rules remove the previously proposed £20,000 personal wallet limit and instead apply a £40 billion issuance guardrail to each systemic stablecoin. Issuers may hold up to 70 % of backing assets in short‑term UK government debt, with the remainder in central‑bank deposits. The framework also covers redemption, safeguarding, liquidity and operational standards, and is intended to allow regulated stablecoins to operate in the UK from 2027, with final rules expected by the end of 2026.

The changes follow industry feedback that the earlier proposal’s wallet caps would hinder operations. The new approach aims to foster trusted digital money that can provide faster, cheaper cross‑border payments while maintaining regulatory oversight. The announcement coincides with shifting capital flows in the crypto market, where assets are moving toward high‑volume chains such as Hyperliquid and Base, while Ethereum experiences net outflows.