Bank of England drops strict stablecoin holding limits, sets $50 billion cap instead

The Bank of England scrapped plans to cap individual stablecoin holdings at $27,000 and corporate holdings at $10 million. Instead, it will cap total circulation of any single systemic stablecoin at $50 billion and let issuers invest 70% of reserves in short-term UK government debt.

• The BOE abandoned proposed limits of 20,000 pounds for individuals and 10 million pounds for corporations.
• A temporary 40 billion pound ($50.6 billion) cap will apply to any single systemic stablecoin's total circulation.
• Issuers can now invest up to 70% of reserves in short-term UK government debt, up from 0% under the original proposal.
• The BOE still bans paying interest to stablecoin holders but permits activity-based rewards like cash-back tokens.
• The reversal follows industry pushback and a House of Lords committee report urging the BOE to reconsider.

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