BoE Signals It May Drop Stablecoin Cap After Industry Backlash
The Bank of England is said to be preparing to abandon a proposed limit on stablecoin holdings following widespread criticism from industry associations, which argued the cap would brand the UK as hostile to crypto and stifle innovation. The original proposal, framed as a risk-control measure, prompted firms and trade bodies to warn it could choke off investment in payments infrastructure and push projects overseas, prompting the central bank to reassess its approach. If the BoE formally drops the cap, it would reduce regulatory uncertainty for stablecoin issuers and fintechs and could help preserve the UK’s attractiveness for crypto payments development. Market participants caution the decision will depend on ongoing consultations and coordination with the Treasury and Parliament, so firms will be watching closely for concrete guidance and any new safeguards the BoE may propose instead.