Bank of England stablecoin rules are moving toward a 2027 launch after the central bank softened parts of its earlier plan and gave issuers more detail on how systemic stablecoins will be backed.
The Bank of England said on June 22 that it published a policy statement and draft Code of Practice for systemic stablecoin issuers.
The rules are aimed at stablecoins that become large enough to matter for UK payments, not ordinary altcoins.
The Financial Conduct Authority, the UK's financial markets regulator, will supervise non-systemic stablecoins, and it will work with the central bank when a stablecoin issuer becomes large enough to fall under the systemic regime.
Systemic stablecoin issuers would be allowed to hold up to 70% of backing assets in interest-bearing short-term UK government debt, up from the 60% level floated last year.
The rest would have to sit in central bank deposits, which the central bank said would help issuers meet redemptions quickly.
- The Bank of England also dropped the temporary holding limits it had consulted on last year.
- Instead, each systemic stablecoin would face an initial £40 billion issuance guardrail.
That means households and businesses would not face temporary wallet caps, while the central bank would still try to limit risks to credit provision if stablecoins grow quickly.
Sarah Breeden, the Bank's deputy governor for financial stability, said the plan was about building trust around a new form of money.
Sarah Breeden
- The Bank of England is taking feedback until Sept. 22 and plans to finalize the Code of Practice by the end of 2026.
- If the timeline holds, regulated stablecoins could operate in the UK from 2027.
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