Bank of England, New Developments in Stablecoin Restrictions

The Bank of England (BoE) is signaling a potential retreat from restrictions regarding stablecoin holdings. Recent high volumes and growing interest in the cryptocurrency market have encouraged the BoE to reconsider certain regulations. The bank is particularly considering exemptions for cryptocurrency exchanges that are required to hold large amounts of stablecoin.

According to Bloomberg, the BoE is also evaluating the use of stablecoins as a payment method in the experimental sandbox for digital securities. Previous drafts suggested a limit of 20,000 pounds (approximately 26,800 dollars) for individuals and 10 million pounds (approximately 13.4 million dollars) for companies. These limits are expected to be clarified in a consultation document that will be opened to public opinion within the year.

There are intense criticisms within the crypto sector. Warnings have been issued that the UK risks “falling behind in innovation” compared to markets like the US. Recently, the US established a comprehensive regulatory framework for dollar-backed stablecoins with the GENIUS Act. BoE Governor Andrew Bailey emphasized that it is “wrong” to oppose stablecoins in principle. He stated that these assets have the potential to develop innovative payment systems. However, he cautioned that for public trust to be ensured, these currencies must “meet the right conditions.”

For investors, these changes in the UK’s cryptocurrency regulations could create significant opportunities. In particular, steps to be taken in the stablecoin market may open the door to a new era for digital assets. Investors are recommended to closely monitor the potential developments of stablecoins like This Coin and the decisions of British regulators.