The Bank of England is demanding a direct stake in the stablecoin market, proposing that issuers of systemic digital currencies hold nearly half of their reserves as deposits at the BoE itself. This key requirement is part of a newly released consultation paper aimed at taming risks to financial stability.
Under the proposed regime, only 60% of reserves could be allocated to short-term UK government debt, a structure that prioritizes security over yield for issuers. The central bank argues this is necessary for tokens widely used for payments.
Alongside these strict reserve rules, the BoE is also floating the idea of a £20,000 per-token holding limit for individuals. The industry now has until February 2026 to provide feedback on this comprehensive regulatory blueprint.
