Bank of England Drops Its Stablecoin Holding Caps — Then Puts a £40 Billion Ceiling on the Whole Market

What Happened

The Bank of England has backed down on the part of its stablecoin plan the industry hated most. In a June 22 policy statement, the central bank dropped the proposed £20,000 limit on how much sterling stablecoin any single person could hold, along with the £10 million ceiling it had floated for businesses. Those individual caps had been a lightning rod for criticism, with firms arguing they made regulated sterling stablecoins effectively unusable for real commerce.

In their place, the Bank installed a single, market-wide guardrail: a £40 billion cap on the total amount of systemic sterling stablecoins that can circulate. Instead of policing how much sits in each wallet, the BoE is now policing the size of the entire pool.

Why It Matters

On the surface, this is a win for the industry. Killing the per-holder caps removes an obvious deal-breaker and signals the Bank is listening to the people who actually have to build and use these products. A merchant or a treasury desk can't operate under a £10 million hard stop, and the BoE clearly heard that message.

But the £40 billion systemwide ceiling swaps one constraint for another. It hands the central bank a single dial to throttle the entire sterling stablecoin market, and £40 billion is not a huge number once a market starts scaling. Critics argue it risks capping Britain's own ambitions at the exact moment the U.S. and EU are racing to set the global stablecoin rulebook. A cap on the category's total size could quietly steer issuers and users toward dollar-denominated tokens that face no such limit.

What's Next

The headline concession buys the Bank goodwill, but the fight now moves to that £40 billion figure and how the BoE plans to enforce it as demand grows. Expect issuers to push for a clearer path to raising the ceiling, and watch whether this framework makes the UK a more or less attractive home for sterling stablecoin projects compared with jurisdictions that have chosen not to put a hard number on the market at all. ☕₿