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Bank of England Reconsiders Parts of Pound Stablecoin Framework

According to the Financial Times, the Bank of England is reconsidering proposed reserve rules and ownership caps for pound stablecoins after industry backlash warned the restrictions could hurt large-scale use and U.K. digital competitiveness.

Fact Check
The claim is well-supported by multiple independent sources. 'Bank of England softens stablecoin regime after industry pushback' (The Modern Regulator, November 26, 2025) directly confirms that the BoE revised its stablecoin consultation, replacing the strict 2023 requirement of 100% central bank deposits with a model permitting up to 60% in short-term UK government debt, explicitly following 46 industry responses criticizing the original framework. The official BoE consultation paper on bankofengland.co.uk corroborates the existence and timing of this revised framework. The FintechWeekly article and UK Parliamentary oral evidence further confirm the industry pressure context and the ongoing regulatory process. The claim accurately characterizes the situation: the Bank of England is scaling back strict stablecoin rules after industry pressure.
Summary

The Bank of England is scaling back parts of its proposed framework for pound-backed stablecoins after criticism from the crypto industry, according to the Financial Times. The review focuses on strict reserve requirements and ownership caps that firms argued could make sterling-denominated stablecoins harder to use at scale and weaken the United Kingdom’s competitiveness in the digital economy. The shift points to a softer regulatory approach rather than a full reversal, as the central bank balances financial stability concerns with support for innovation in crypto-linked payment instruments. No final revised rules or timeline were provided.

Terms & Concepts
  • Stablecoin: A cryptocurrency designed to maintain a stable value by being linked to an asset such as a fiat currency like the British pound or U.S. dollar.
  • Reserves: Assets held to back a stablecoin and support redemptions, helping the token maintain its intended peg.
  • Ownership caps: Limits on how much of an asset or token a user or institution can hold, often proposed to reduce concentration or systemic risk.