Bank of England Plans Exemptions to Stablecoin Limits

The Bank of England is preparing to carve out exceptions to its proposed stablecoin holding limits, according to sources familiar with the matter. crypto exchanges and other institutions requiring large-scale token holdings will receive waivers, signaling a pragmatic approach to digital asset regulation.

Stablecoins gain further legitimacy as the BoE confirms their use for settlement within its Digital Securities Sandbox. This development follows last month's controversial proposal to cap individual holdings at £20,000 and institutional holdings at £10 million - limits the industry decried as impractical.

Governor Andrew Bailey's July warnings about stablecoin risks now appear balanced by recognition of their growing role in global finance. The policy shift aligns the UK more closely with regulatory frameworks emerging in the US and Hong Kong, where stablecoins are achieving mainstream financial integration.