The Bank of England (BoE) is facing criticism from cryptocurrency and payment groups over its proposal to impose strict restrictions on stablecoin ownership. This initiative would make the United Kingdom’s regulations tougher than those in the US or the EU.
According to the press release, the central bank plans to cap individual ownership of systemic stablecoins, tokens widely used or likely to be used for UK payments, at £10,000 to £20,000 ($12,500 to $25,000), and business ownership at £10 million ($12.5 million). The BoE argues these limits are necessary to protect the banking system from deposit drainage and financial stability risks, such as sudden credit shortages for businesses and households.
The global stablecoin market is worth about $288 billion, mostly driven by USD-based tokens, and Coinbase expects it to grow to $1.2 trillion by 2028. In July, the US introduced the GENIUS Act, a law that creates a regulatory framework for stablecoins in its financial system.
In contrast, the BoE’s proposed caps have sparked concerns about stifling innovation and placing the UK at a competitive disadvantage. Tom Duff Gordon, Vice President of International Policy at Coinbase, stated, “Imposing caps on stablecoins is bad for UK savers, bad for the City, and bad for sterling.” He further added that, “No other major jurisdiction has deemed it necessary to impose caps.”
Industry executives argue the limits would be costly and complex to enforce. Simon Jennings, executive director of the UK Cryptoasset Business Council, noted that stablecoin issuers lack visibility into token holders, requiring expensive systems like digital IDs or wallet coordination to implement caps.
The debate has heightened tensions between the BoE and the Treasury, especially after BoE Governor Andrew Bailey intervened to delay a fintech banking license for Revolut. Chancellor Rachel Reeves has pledged to advance blockchain technology, including stablecoins, to support UK financial innovation.
The BoE has described the limits as potentially “transitional” to help the financial system adapt to digital currencies. It plans to release a consultation on stablecoin regulation later this year. Gilles Chemla, a professor at Imperial Business School, warned that the UK risks falling behind in stablecoin regulation. “London has the talent and markets to lead the digital economy, but delays in regulatory frameworks are eroding that edge,” he said.
On July 3, 2025, the Bank of England cautioned that the growing popularity of stablecoins could undermine public confidence in conventional currency.
