Bank of England Proposes Strict Stablecoin Ownership Limits
The Bank of England (BoE) faces criticism from crypto and payment groups. It plans to impose strict limits on stablecoin ownership in the UK. These rules would be tougher than those in the US or the EU.
According to the BoE press release, individual ownership of systemic stablecoins would be capped between £10,000 and £20,000 ($12,500 to $25,000). Businesses would face a £10 million ($12.5 million) ownership limit. The BoE says these caps protect the banking system from risks like deposit outflows and credit shortages.
Stablecoin Market Growth and Regulatory Differences
The global stablecoin market is valued at about $288 billion, mainly from USD-based tokens. Coinbase expects it to reach $1.2 trillion by 2028. In July, the US passed the GENIUS Act, creating a regulatory framework for stablecoins.
In contrast, the BoE’s proposed caps have raised concerns. Critics say the limits could stifle innovation and hurt the UK’s competitiveness. Tom Duff Gordon, Coinbase’s Vice President of International Policy, said, “Imposing caps on stablecoins is bad for UK savers, bad for the City, and bad for sterling.” He added, “No other major jurisdiction has deemed it necessary to impose caps.”
Industry leaders also highlight enforcement challenges. Simon Jennings, executive director of the UK Cryptoasset Business Council, said stablecoin issuers lack clear visibility of token holders. He noted that implementing caps would require costly systems like digital IDs or wallet coordination.
Regulatory Tensions and Future Outlook
The BoE’s stablecoin limits have increased tensions with the Treasury. BoE Governor Andrew Bailey recently delayed a fintech banking license for Revolut. Meanwhile, Chancellor Rachel Reeves supports advancing blockchain and stablecoin innovation in the UK.
The BoE describes the caps as potentially “transitional” to help the financial system adjust to digital currencies. It plans to launch a consultation on stablecoin regulation later this year. Gilles Chemla, professor at Imperial Business School, warned the UK risks losing its lead in digital finance. He said, “London has the talent and markets to lead the digital economy, but delays in regulatory frameworks are eroding that edge.”
On July 3, 2025, the BoE warned that the rising use of stablecoins could weaken public trust in traditional money.
