Bank of England overhauls stablecoin rules with issuance cap guardrails and revised reserve requirements

The Bank of England has revised its stablecoin regulatory approach, replacing stablecoin holding caps with an issuance-limit “guardrail” framework. Multiple reports say the update sets a cap of £40 billion (or $53 billion, in one accounting) for stablecoin issuance rather than limiting users’ holdings ^{[1] [2] [3]}.

Reporting on the policy change also notes that the BoE’s new rules adjust reserve requirements for stablecoin issuers, including allowing issuers to hold a larger share of reserves in UK government debt (described as 70% in one account). The changes are framed as aimed at supporting regulated digital money while addressing financial stability concerns ^{[1] [4] [3]}.

Overall, the BoE’s update shifts the focus from restricting how much stablecoins participants can hold to constraining aggregate issuance and revising issuer reserve allowances ^{[1] [3]}.