The Bank of England has published final policy and regulatory proposals for systemic stablecoins, adjusting several provisions from last year’s consultation paper. The new framework eliminates individual and corporate holding limits, replacing them with an overall issuance cap per systemic stablecoin issuer, initially set at £40 billion, with finalization planned by the end of 2026.
Change holding restrictions to issuance cap
In its November 2025 consultation paper, the Bank of England proposed a limit of £20,000 for individual holdings of systemic stablecoins and £10 million for corporate holdings. This arrangement faced opposition from industry groups, who argued it would restrict practical use cases such as payments and settlements.
The latest proposal removes the aforementioned holding limits and instead sets an overall cap determined by the issuer. The Bank of England states that this approach achieves a similar level of risk control but with lower implementation costs and greater ease of deployment. For users, both individuals and businesses are no longer subject to direct holding limits.
The central bank stated that this cap will be managed at the issuer level rather than by tracking individual user balances, making it easier to enforce on distributed or decentralized networks. The cap will be reviewed periodically, and consideration will be given to relaxing or removing it once the broader economic impacts of stablecoins—such as on credit supply—become clearer.
How is the £40 billion limit set?
The Bank of England stated that an initial cap of £40 billion is sufficient to enable systemic stablecoin issuers to achieve a viable scale and support daily transaction volumes comparable to those of the UK’s major payment systems.
For reference, the daily transaction volume of the UK’s Faster Payments and card payment systems is approximately £1.4 billion to £2.2 billion. The central bank also noted that this limit is roughly equivalent to about 10% of CHAPS’s daily processing volume. According to its assessment, this scale would also support the use of stablecoins to settle the cash leg within the digital securities sandbox, while avoiding overly restrictive constraints too early.
Reserve requirements have been slightly relaxed
Regarding reserve arrangements, the Bank of England has also adjusted its previous proposal. Systemically important stablecoin issuers may now allocate up to 70% of their reserve assets to short-term UK government bonds, up from the previously proposed 60%. The remaining portion must be held as non-interest-bearing deposits at the Bank of England.
The Bank of England also stated that it is working with the UK Financial Conduct Authority to develop a broader regulatory framework for stablecoins, including arrangements for managing the transition of entities from non-systemic to systemic stablecoins. Further details are expected to be released alongside the FCA’s final rules.