The Bank of England is introducing temporary restrictions on stablecoins.
Date: 2025-10-17 Author: Oliver Abernathy Categories: IN WORLD
The Bank of England has announced plans to temporarily restrict the holding and trading of stablecoins to mitigate potential risks to the economy. Deputy Governor Sarah Breeden noted that the restrictions will remain in place until the financial system becomes resilient to potential fluctuations associated with digital currencies.
The idea of regulating stablecoins was first presented in a discussion paper in November 2023 as a means of supporting financial system stability. In September 2025, as the plans were being refined, industry organizations expressed criticism, stating that such measures could hinder innovation and slow the development of cryptocurrency businesses in the UK.
According to Sarah Breeden, the introduction of limits will allow the Bank to monitor the use of stablecoins in the economy and assess potential changes to the financial structure. "We plan to lift the restrictions once we are satisfied that they do not threaten the financing of the real economy," she emphasized.
Proposed limits on stablecoin ownership previously ranged from $13,429 to $26,858 (£10,000-£20,000). Experts believe such limits could signal to the market that the UK is becoming less attractive to cryptocurrency companies.
The Bank of England intends to consult with market participants by the end of 2025 to discuss the details of introducing the limits and their mechanisms. Options under consideration include increasing limits for corporate clients and exempting large companies, such as supermarkets, from these restrictions.
Furthermore, the possibility of an exemption for participants in the digital sandbox, launched in October 2024, is being discussed. This platform allows companies to test digital ledger technologies in a controlled environment.
Regulation of stablecoins in the UK remains under discussion, but the Bank of England has stated its willingness to consider feedback from market participants and adjust regulations to reflect the industry's realities. These measures are aimed at ensuring the resilience of the financial system without unduly restricting innovation and economic growth.
