BoE Considers Easing UK Stablecoin Caps After Industry Backlash
The central bank argued that limits were needed to avoid a sudden outflow of deposits from commercial banks into new forms of “tokenised” money if a large stablecoin were rapidly adopted for payments. Industry groups and prospective issuers countered that the caps were operationally cumbersome, hard to supervise across platforms, and could deter serious institutional use of regulated UK stablecoins in areas like corporate treasury, payroll and settlement. BoE rethinks stablecoin caps after pushback Breeden has been one of the most cautious voices on stablecoins within the BoE. In November 2025, she warned that diluting the rules too far could damage financial stability, stressing that stablecoins are money-like instruments that must be at least as safe and robust as existing payments infrastructure. At the time, she backed stringent liquidity requirements that would force stablecoin issuers to park large portions of their reserves at the central bank and hold the rest in high-quality liquid securities such as UK government bonds. Law firms and potential issuers argue that such a structure would significantly compress margins and make UK stablecoin issuance far less attractive than operating under the United States or European Union regimes. UK hunts for middle ground on stablecoins The shift in tone highlights how UK policymakers are
