Bank of England Faces Backlash Over Proposed Stablecoin Holding Limits

The Bank of England's draft proposal to cap stablecoin holdings at £10,000–£20,000 for individuals and £10 million for businesses has ignited fierce opposition from crypto industry participants. Policymakers justify the measures as necessary safeguards against systemic risks, particularly the potential migration of bank deposits into stablecoin products.

Market participants counter that the restrictions WOULD prove operationally unenforceable across decentralized wallets while placing the U.K. at odds with emerging global standards. Coinbase executives characterize the approach as punitive toward retail investors seeking dollar-pegged alternatives during periods of currency volatility.

The controversy highlights growing tensions between financial regulators and digital asset innovators as stablecoins increasingly bridge traditional and crypto markets. Industry groups warn the proposed limits could accelerate capital flight to jurisdictions with more nuanced regulatory frameworks.