Bank of England removes individual caps for systemic stablecoins

The Bank of England published on June 22, 2026 the British draft of systemic stablecoins in pounds and its policy positions after the 2025 consultation. It eliminated permanent individual limits and proposed 60/40 reserves and a temporary backstop per issue. The Code of Practice was still under consultation and was not yet final.

What changed after the consultation

The November 2025 proposal had included limits on how much each person or company could maintain. Participants questioned its feasibility, privacy and effect on payments. The Bank ruled out those caps as a permanent feature.

Instead, he proposed temporarily limiting the total size of each systemic stablecoin, with a starting point of £40 billion. The safeguard sought to prevent a rapid migration from bank deposits from affecting financing and credit as the market developed.

The per-issuance limit reduces the need to track all of an individual’s wallets, but concentrates responsibility on the issuer. This must control units in circulation and stop minting in an orderly manner without preventing redemptions.

The 60/40 combination of reserves

The Bank proposed that up to 60% of the support be held in short-term British government debt and the remaining 40% in unremunerated deposits at the central bank. The combination was intended to ensure liquidity and enable a viable model.

Deposits in the Bank eliminate credit risk, but do not generate returns. Short gilts help cover costs, although their value may vary. Limits of duration, concentration and custody must preserve the capacity for redemption at par.

The reservation belongs to the owner protection scheme and needs segregation. You cannot freely finance the group. Audits, reconciliation and disclosures allow comparison of issued tokens with available assets.

Redemption and resolution

The issuer would have a legal obligation to redeem at the face value in pounds. You should have processes in place for normal and stress requests. An always-open interface does not guarantee immediate bank payment; The terms should explain deadlines and contingencies.

Recovery and resolution plans seek to ensure that a bankruptcy does not destroy value or paralyze critical payments. The Bank needs to be able to transfer operations, access data and protect reserves. Key and technology providers must cooperate even if the issuer fails.

A systemic stablecoin does not become an insured deposit. The holder has redemption and backup protection under a specific regime. The communication should avoid suggesting non-existent coverage.

FCA and Bank of England

The FCA will regulate stablecoins and custodians in the general scope. The Bank of England will supervise systems recognized as systemic. An issue can begin under the FCA and move to the Bank upon reaching scale, with coordination to avoid gaps.

Recognition depends on importance for payments and stability, not just capitalization. Use, interconnection and consequences of an interruption count. Until the act of recognition, not every stablecoin in pounds is subject to the systemic code.

What was still pending

The publication included a draft Code of Practice. The Bank intended to complete it by the end of 2026 and develop additional materials in 2027. Companies could plan, but not claim definitive compliance with an open text.

The safeguard of 40,000 million was also initial and reviewable. Its concrete application required criteria and coordination. A policy number is not a substitute for the final document.

Outlook from 2026

As of August 7, 2026, the draft remained the Bank’s most recent position, with final code expected later. The modifications compared to 2025 show that the consultation had an influence, but they still do not close the procedure.

The evolution changed individual control for a macroprudential limit. The challenge will be to allow scale without destabilizing deposits and maintaining real redemption. For users, it is important to verify the issuer, regime and date of application.