Overview
- Individuals would face a £20,000 limit per systemic sterling stablecoin and most businesses £10 million, with exemptions available for larger operational needs and wholesale activity in the Digital Securities Sandbox.
- Issuers must hold at least 40% of liabilities as unremunerated deposits at the Bank of England, with up to 60% in short‑term UK government debt and a transitional allowance up to 95% in gilts for early stages.
- The Bank is considering central‑bank liquidity facilities for sound issuers unable to sell reserve assets during stress, creating a financial‑stability backstop for redemptions.
- HM Treasury would designate which tokens are systemic, the Bank of England would oversee prudential risks, and the FCA would handle conduct and consumer protection, with non‑sterling trading tokens remaining under the FCA.
- The consultation runs until February 10, 2026, with final rules expected next year, and early industry feedback welcomes interest‑bearing reserves but challenges the holding caps as too restrictive.