The Bank of England (BoE) targets late 2026 to finalize stablecoin rules, aligning reserves with US rules to protect financial stability.
The Bank of England (BoE) plans to introduce comprehensive stablecoin regulations now. The new final deadline is set for the end of 2026. This initiative brings the United Kingdom into line with the emerging standards around the world right away. This move will ensure the safe integration of digital currencies into the financial system. The move by the central bank follows growing regulatory pressure on a wide-ranging basis.
Bank of England to Begin Stablecoin Consultation in November 2025
The BoE plans to conduct a public consultation in the near future. Specifically, this stablecoin regulation consultation starts on November 10, 2025. The central bank is likely to support a regime similar to US rules at present. This framework will be focused on the assets that back digital currencies closely. Therefore, this strategic alignment minimizes regulatory arbitrage quite effectively.
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The framework will require reserve assets to be primarily government bonds. Crucially, these bonds should have maturities of less than three months strictly. Furthermore, the proposed rules will enable interest-bearing assets in reserves. This measure provides an incentive to the issuers in effect. It also provides for the demand for UK sovereign debt immediately.
Additionally, the BoE believes this new framework will remain up-to-date. This is important when the US rules are being implemented. As a result, this proactive approach helps in controlling any internal tensions at this point. The BoE is closely working with the Financial Conduct Authority (FCA). Ultimately, both authorities hope to have all of the rules completed by 2026.
The BoE framework will only apply to systemic stablecoin issuers. Conversely, the FCA will have a broad oversight of the crypto custody regimes widely. This delineation is guaranteed to be a clear and efficient regulatory division. In addition, draft legislation was published by the HM Treasury in April 2025. Consultations are ongoing regarding requirements, and they are proceeding actively at this point.
U.K. Strengthens Framework for Safe Stablecoin Integration
Importantly, there are now holding caps in the regulations under development. The BoE proposed these caps as a temporary measure at the moment—specifically, these caps limit individual holdings between GBP10,000 and GBP20,000. Businesses will be left with an upper limit of $10m safely.
Consequently, this restriction is aimed at preventing fast outflows from conventional bank deposits. Such movements might severely damage the overall financial stability. However, these temporary caps have been criticized publicly by the crypto industry. Nonetheless, a BoE Deputy Governor stated that they will be lifted soon. This will occur when the financial threat is completely over.
Furthermore, systemic issuers may be given access to accounts at the Bank of England. This is meant to strengthen their status as a legitimate form of money now. The new rules will specify the composition of reserves and the liquidity standards. The bottom line is that they are focused on reserve assets of high quality now. This is necessary for global consistency with US rules.
Separately, new reporting requirements for cryptoassets will kick in soon as HMRC finalises its cryptoasset reporting requirements. This is scheduled for January 2026. Additionally, this supports the UK’s commitment to the Global Cryptoasset Reporting Framework (CARF).
