Bank of England Softens Stablecoin Cap Plan After Pushback

The Bank of England (BoE) is moving ahead with plans to impose limits on stablecoin holdings, but will introduce exemptions following industry criticism.

While the regulator seeks to contain financial risks in digital assets, the revised framework may allow certain crypto firms to maintain larger reserves and use stablecoins for settlement within regulatory sandboxes.

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BoE Moves to Cap Stablecoin Holdings with Industry Carve-outs

The Bank of England is preparing to introduce limits on stablecoin holdings. The goal is to strengthen oversight of digital money while preserving financial stability.

Under the draft framework, individuals could hold up to $13,400-$26,800 (£10,000–£20,000 ) in stablecoins, and businesses up to $13.5 million (£10 million).

However, after widespread industry objections, the BoE is reportedly planning to include exemptions for crypto exchanges, custodians, and fintech firms that rely on larger stablecoin reserves for operational liquidity.

Officials familiar with the matter told Bloomberg that the measure is not intended to restrict legitimate market activity. Instead, it seeks to “contain systemic risk” as stablecoins become increasingly integrated into mainstream payment systems.

The revised framework may differentiate between stablecoins used for consumer payments and those employed by institutional actors for settlement or liquidity management.

The central bank has signaled that the final proposal will be open to public consultation later this year. Implementation is expected to be phased in during 2026.

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