LONDON, June 22, 2026 — The Bank of England issued a policy statement and draft rules for systemic stablecoin issuers, outlining key elements of the United Kingdom’s proposed framework for systemic stablecoins.
Framework for digital money
According to the central bank, the framework is intended to support innovation in digital payments while maintaining confidence, resilience and trust in money. The Bank said regulated stablecoins could enable faster, cheaper and more flexible payment services, including cross-border use cases and programmable functionality.
The policy statement and draft Code of Practice reflect feedback received following the Bank’s consultation launched in November 2025.
Reserve composition requirements
Among the changes announced, the Bank increased the maximum share of backing assets that may be invested in short-term UK government debt to 70%, up from the 60% proposed previously.
The remaining reserves would be held in central bank deposits, which the Bank said enable issuers to meet redemption requests promptly. According to the Bank, the change supports more viable business models while still allowing issuers to deal with outflows.
Temporary issuance guardrail
The Bank decided not to proceed with temporary holding limits that had been proposed during the consultation process. Instead, it said each systemic stablecoin would be subject to a temporary issuance guardrail initially set at £40 billion.
The Bank said the measure is intended to safeguard the economy’s access to credit while allowing unrestricted use by households and businesses. The issuance guardrail will be reviewed regularly and removed once risks to credit provision have been addressed.
Sarah Breeden, Deputy Governor for Financial Stability, said the framework establishes the foundations of trust for a new form of money, with prompt redemption, strong protections and central bank support.
Supervisory responsibilities
The Bank of England and the Financial Conduct Authority are working together to establish an end-to-end regulatory regime, including a managed transition as firms grow from non-systemic to systemic. The Bank said additional details will be published alongside the FCA’s final rules.
According to the central bank, stablecoins used for non-systemic purposes, such as the buying and selling of cryptoassets, which it described as the predominant use of stablecoins today, will not fall under the Bank’s regime and will instead be supervised solely by the FCA.
Next steps
Subject to feedback received by Sept. 22, 2026, the Bank intends to finalize the Code of Practice by the end of 2026. According to the central bank, the framework would allow regulated stablecoins to operate in the United Kingdom from 2027.
Why it matters
The new framework advances the United Kingdom’s plans to establish a regulatory regime for stablecoins used in payment systems while creating separate supervisory responsibilities for the Bank of England and the Financial Conduct Authority. The approach is intended to support innovation in digital money while maintaining financial stability and confidence in the payments system.
