The Bank of England (BoE) has published a consultation paper outlining a proposed regulatory regime for sterling-denominated systemic stablecoins, those considered capable of becoming widely used for payments in the UK. Bank of England
Under the proposal:
- Issuers would be permitted to hold up to 60% of the backing assets in short-term UK government debt, while a minimum of 40% must be held as unremunerated deposits at the BoE. Reuters
- Individual holding limits are proposed at around £20,000, while larger businesses could be capped at higher amounts. PYMNTS.com
- The regime aims to balance innovation in digital money with financial stability and the BoE has indicated it may loosen such limits once systemic risk is better understood. Bank of England
The consultation invites feedback on the proposed framework, which is part of a broader UK strategy to regulate crypto-assets, stablecoins and digital money.
