September 16, 2025
By Anjali Kochhar
The Bank of England (BoE)’s latest proposal to place strict limits on how much stablecoin individuals and firms can own has drawn heavy criticism from the cryptocurrency industry, which argues that the rules could hamper innovation, hurt savers, and weaken Britain’s position in the race to regulate digital finance.
Officials have floated ownership caps of £10,000 to £20,000 (about US$13,600 to US$27,200) for individuals, and up to £10 million (US$13.6 million) for businesses, on “systemic” stablecoins, meaning those widely used for payments or likely to become so. These proposals are part of the BoE’s effort, in coordination with the Financial Conduct Authority, to establish a robust regulatory framework for stablecoins, which are tokens pegged to fiat currencies.
The central bank defends the proposal, saying it is necessary to protect the traditional banking system. Regulators fear that outsized adoption of stablecoins could draw deposits away from banks and destabilise financial markets. They view the ownership caps as possibly temporary, using them until the market sufficiently adapts to the increasing prevalence of digital money.
However, industry groups say the plan is both heavy-handed and difficult to enforce. Tom Duff Gordon, vice president of international policy at Coinbase, said the caps would be “bad for UK savers, bad for the City and bad for sterling.” Simon Jennings of the UK Cryptoasset Business Council added that monitoring who holds stablecoins at any given moment, especially across wallets, would require complex systems like digital IDs and continuous tracking that may be impractical.
The proposal has also stirred tensions between the BoE and the UK Treasury, which has recently adopted a more innovation-friendly stance. Chancellor Rachel Reeves has expressed interest in pushing forward developments in blockchain technology, including tokenized assets and stablecoins. Critics argue that the BoE’s ownership caps run counter to this agenda.
Globally, the UK stance diverges from other jurisdictions. In the US, Congress recently passed the GENIUS Act, which integrates stablecoins more closely into the financial system, while the European Union has rolled out comprehensive rules under its Markets in Crypto Assets (MiCA) regulation, both without imposing ownership limits.
With the stablecoin market currently valued at about US$288 billion, mostly in dollar-pegged tokens, industry forecasters expect growth to US$1.2 trillion by 2028. UK businesses warn that under restrictive ownership rules, adoption might stall or shift outside the UK, putting British competitiveness at risk.
The BoE plans to publish a formal consultation later this year to outline the details of its regulatory approach. Meanwhile, many in the crypto sector are urging more flexible rules so that innovation is not stifled and the UK remains a leading player in global digital finance.
About the author
Anjali Kochhar covers cryptocurrency and blockchain stories in India as well as globally. Having been in the field of media and journalism for over four years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
