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UK central bank relaxes initial stablecoin rules, allowing broader institutional backing
Bank of England eases proposed backing rules for stablecoins, allowing majority investment in UK government bonds and relaxing holding-caps ahead of 2026 regime.
The Bank of England has scaled back the strict backing requirements for systemic stablecoins: issuers may now invest up to 60% of their backing assets into short-term UK government debt (from previously 100% cash), with up to 95% allowed during growth phase. The revised proposals also reduce individual holding caps and loosen ownership restrictions for corporates in crypto-platforms.
The changes reflect industry feedback but critics say the UK may lag U.S. innovation.