The UK will release a consultation on stablecoin regulation on November 10, following the lead of the United States.

The Bank of England (BOE) plans to release a consultation on stablecoin regulation on November 10, 2025, to ensure its competitiveness in the global cryptocurrency market and align with U.S. regulatory measures. According to Bloomberg, the new proposal is expected to include temporary limits on holdings of stablecoins for individuals and businesses. Additionally, the regulation will, for the first time, target “systemic” stablecoins, aiming to ensure these tokens can be used safely and stably for payments, while applying more relaxed rules to other stablecoins. This move will help the UK maintain a leading position in the global stablecoin regulatory race.

Overview of the UK Bank’s Stablecoin Regulation Proposal

The UK Bank’s Stablecoin Regulatory Framework

Bloomberg reports that the Bank of England will publish detailed consultation documents on stablecoin regulation on November 10, 2025. The proposal aims to establish a clear regulatory framework for the UK’s stablecoin market, ensuring synchronization with U.S. regulations worldwide. Sarah Breeden, Deputy Governor of the Bank of England, stated that the UK’s progress in stablecoin regulation will not lag behind the U.S., and the new rules will “come into effect as quickly as those in the U.S.”

Initial Proposal: Focus on “Systemic” Stablecoins

Under the new proposal, initial regulations will specifically target stablecoins deemed “systemic” by the Bank of England. These tokens, which could be widely used for payments, will face stricter oversight. Other types of stablecoins will remain under the regulation of the Financial Conduct Authority (FCA), with lighter management measures.

Temporary Limits: Restrictions on Holdings for Individuals and Businesses

The new regulatory framework will include temporary caps on stablecoin holdings. The proposal suggests a maximum of £20,000 (approximately $26,000) for individuals and £10 million for businesses. Breeden explained that the UK’s stricter limits are due to its primarily bank-based mortgage market, which makes it more susceptible to rapid capital inflows into stablecoins.

Background and Importance of Stablecoin Regulation

Competition Between the UK and U.S. in Crypto Regulation

As the global crypto market rapidly develops, stablecoin regulation has become a key focus for governments. Stablecoins, as crypto assets pegged to fiat currencies, are highly liquid and stable, making them valuable for payments and financial transactions. However, their rapid growth also poses financial risks, especially if regulation is insufficient, potentially destabilizing markets.

In recent years, the U.S. has gradually refined its regulations on cryptocurrencies and stablecoins, becoming a global benchmark. To stay competitive, the UK government must strengthen its regulatory framework, particularly for stablecoins, to attract more investors and innovation.

UK Government’s Digital Market Reforms

To boost financial market competitiveness, the UK has accelerated reforms in stablecoin regulation. Last year, the government announced plans to appoint a “Digital Markets Champion” to promote blockchain technology in wholesale financial markets, aiming to improve efficiency and ensure system stability through innovation. The FCA has also lifted a four-year ban on retail crypto exchange-traded notes (ETNs), expanding access to crypto products.

Risks and Opportunities of Stablecoins

Stablecoins are a vital part of the crypto ecosystem, offering both risks and opportunities. They provide more efficient solutions for global payments and cross-border transfers. However, without effective regulation, stablecoins could be misused for speculation, and their growth might threaten financial stability. Therefore, balanced regulation is crucial to foster innovation while managing risks.

Goals of the Bank of England’s Stablecoin Regulation

Ensuring Financial Stability and Promoting Innovation

The BOE’s proposed regulation aims to maintain financial stability while encouraging blockchain and crypto asset innovation. A clear regulatory framework will help prevent shocks from rapid stablecoin growth and support healthy market development within a compliant environment.

Breeden emphasized that the BOE seeks a practical regulatory model through this proposal, ensuring stablecoins do not pose systemic risks while fostering innovation and enterprise growth. She also highlighted that UK’s policies will be implemented promptly and will not fall behind other major economies, especially the U.S.

Strict Regulations for “Systemic” Stablecoins

According to the proposal, the BOE will initially impose strict regulations on “systemic” stablecoins—tokens that are widely used and could impact the stability of the payment system. These will include mandatory limits and higher transparency standards. Other stablecoins will continue to be regulated by the FCA under more lenient rules.

Flexibility and Adaptability of the Regulatory Framework

To keep pace with market developments, the BOE’s stablecoin regulation will be designed with flexibility. The framework will evolve based on market feedback and emerging risks, with potential adjustments in the coming months to ensure effectiveness and practicality.

Conclusion

The upcoming stablecoin regulation proposal from the Bank of England marks a significant step in the UK’s crypto oversight. It aims to promote a healthy crypto market while safeguarding against financial risks. As the crypto sector matures, stablecoin regulation will become a key global regulatory issue. For investors, businesses, and policymakers, these rules will influence the future trajectory and potential of the crypto industry.

The BOE’s framework not only enhances the UK’s global competitiveness but also offers a reference model for other regulators. As international focus on crypto regulation intensifies, stablecoins will be a priority for governments worldwide, driving the standardization and growth of the global crypto industry.