Overview
- The Bank of England published its policy position and draft Code of Practice on Monday, June 22, 2026, removing proposed individual and corporate holding limits and instead setting a temporary £40 billion issuance cap for each systemic sterling stablecoin.
- Issuers may back up to 70% of reserves in short‑term UK government debt and must keep the remaining 30% as non‑interest‑bearing deposits at the Bank, a change designed to ease the cost burden on firms while preserving liquid buffers for redemptions.
- The framework covers only ‘systemic’ payment stablecoins that could affect financial stability and will be supervised by the Bank with the FCA retaining oversight of non‑systemic tokens; HM Treasury will designate which coins are systemic.
- The draft forbids paying interest or dividends directly to holders but allows activity‑based rewards such as cashback, and the Bank says the issuance guardrail is temporary and subject to periodic review as the market matures.
- The BoE is taking feedback until September 22, 2026, plans to finalise rules by the end of 2026 and targets regulated sterling stablecoin activity in 2027, while industry reaction is mixed with some firms welcoming improved economics and others warning the regime may remain too cautious to attract onshore issuance.