Why Is the UK Suddenly Becoming More Friendly to Stablecoins?
- UK gives the BoE a legal duty to support innovation in payments and digital finance.
- No per-user cap on stablecoins; a £40 billion limit now applies to total issuance.
- Reserve rules eased, allowing more funds in interest-bearing assets for issuers.
For years, the Bank of England (BoE) took a cautious stance on stablecoins. Crypto firms complained that the BoE’s rules were too strict and discouraging innovation in the UK. Now, that tone is changing fast.
The UK Treasury is giving the BoE a new legal duty to support innovation in payments and digital money. Its main job will still be keeping the financial system stable, but it will also be expected to help new financial technologies grow.
The BoE will have to report on this goal every year, putting pressure on it to keep up with new technology.
City minister Lucy Rigby said the goal is to balance both sides:…
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