Bank of England eases stablecoin rules, introduces 40B pound issuance cap
The Bank of England published draft rules for systemic stablecoins, easing reserve requirements and replacing holding limits with a temporary 40-billion British pound issuance cap.
The Bank of England (BoE) published a policy statement and draft rules for systemic stablecoins on Monday, outlining how regulated British pound-backed stablecoins would operate in the United Kingdom.
The BoE defines systemic stablecoins as those that are widely used in payments and may pose risks to the UK’s financial stability. HM Treasury is responsible for determining whether a stablecoin falls within the systemic regime.
Under the policy statement, systemic stablecoin issuers will be allowed to hold up to 70% of reserves in interest-bearing government debt, up from 60% under the previous proposal. Proposed holding limits have also been replaced with a temporary 40-billion-pound ($52.8 billion) issuance cap.