Bank of England open to revising stablecoin caps after feedback

The Bank of England is open to changing proposed limits on how much sterling stablecoin individuals and companies can hold, following industry pushback. Deputy Governor Sarah Breeden outlined the position before the House of Lords Financial Services Regulation Committee on Wednesday and confirmed updated draft rules are planned for June.

The consultation, launched in November, proposed temporary holding caps of £20,000 ($26,740) for individuals and £10 million ($13.4 million) for businesses as stablecoins enter use in payments. Breeden told lawmakers the central bank is “genuinely open to other ways of achieving the objective” of protecting financial stability.

Coinbase CEO Brian Armstrong warned the UK caps may slow digital finance, making the country an “innovation blocker,” while lawmakers cautioned they could deter activity. A petition from Stand With Crypto UK drew over 80,000 signatures before March 3. In October 2025, potential exemptions failed to ease concerns that retail caps would be hard to enforce across multiple wallets and could slow sector growth.

Officials have argued that limits could help curb the risk of rapid shifts out of bank deposits if consumers and companies move funds into stablecoins. The UK relies heavily on bank deposits to fund lending, in contrast to the United States’ greater use of capital markets. In her remarks to the committee, Breeden noted, “We proposed holding limits as a way of managing that risk.”

The Bank of England is reviewing responses to the consultation. Breeden indicated the central bank aims to publish updated draft rules in June, with a final framework targeted by year-end.

Monitoring compliance with caps presents technical challenges because stablecoins are easily transferred on secondary markets, which can obscure how much any person ultimately holds. Breeden acknowledged these hurdles and questioned whether building systems to police temporary limits would be worth the cost. “What we’ve been a bit disappointed with is that nobody has come forward and said, ‘why not do it this way?’” she added, noting that much of the feedback has opposed the limits without offering alternatives.

Interest in tokenized payments is growing across Europe. Banks and payments companies, including Barclays, are testing blockchain-based platforms for payments and digital settlement. A consortium of established firms plans to introduce euro-denominated stablecoins in 2026.

UK authorities are assessing how stablecoins could fit into the country’s payments infrastructure. The Financial Conduct Authority has indicated that stablecoins used as everyday money will be a regulatory priority in 2026. Digital asset companies, including Coinbase and Kraken, have called for clear and timely rules.

Breeden noted it remains uncertain how widely stablecoins will be used in the UK, pointing to questions about scalability, consumer adoption, and whether tokenized bank deposits could emerge as a competing model. She indicated the central bank is prepared to adjust its approach if stronger options are presented during the rulemaking process.